Landlords urged to think twice about selling up

Landlords around the UK who are considering selling up and leaving the private rental sector are being urged to think twice and consider using a letting agent.

The call comes from Propertymark, the trade body for letting agents, who say that economic difficulties following the Covid-19 pandemic may mean lots of landlords are re-evaluating their positions.

The organisation highlights that ever-changing regulatory requirements are also leading to growing numbers of landlords deciding to sell their rental properties.

However, with the right support, advice and tools from professionals, a landlord’s experience can be transformed, and the property will remain a sound investment.

They point to a District Councils Network survey that was carried out late last year and it found that 76% of local authorities say they’ve seen a growing number of landlords selling up - while there’s an equal rise in demand for a rental property.

‘Exit the BTL market’

Propertymark says: “A decision to exit the BTL market, however, is likely to be ill-advised and premature.

“The Propertymark PRS reports show increasing rents over the last three months and void periods at the shortest for years.”

The organisation says that a Propertymark agent will help a landlord explore their options when they are thinking of selling a buy to let property and look at ways of overcoming barriers that the landlord may be facing.

Propertymark says: “For a landlord, the first port of call for advice should be a Propertymark expert. Whatever the problem, there will be options to explore and solutions.”

The organisation adds that there are growing numbers of tenants looking for a home to rent.

Landlords who are new to the private rental sector

However, Propertymark acknowledges that for landlords who are inexperienced or new to the private rental sector, navigating the requirements they have to meet is not easy.

They say that letting agents are not only professional but need to be trained to a higher standard than is required by the law and they can offer support and advice to make a landlord’s experience simpler.

Propertymark says: “Letting agents understand the pressures that a landlord is under and can cut through the confusion and jargon to provide solutions and answers, whatever the situation.”

The trade body has now published a number of free guides to help landlords that detail their legal responsibilities and offer practical advice when it comes to letting properties.

‘An experienced letting agent can prove invaluable’

The managing director of Accommodation for Students, Simon Thompson, said: “There’s no doubt that for inexperienced and new landlords that an experienced letting agent can prove invaluable.

“Many investors new to PRS do not understand their legal obligations for delivering a safe and comfortable home to rent and if Propertymark can help landlords remain in the sector, that is to be encouraged since the country needs quality rental homes for growing numbers of tenants.”

81% of tenants are happy renting their home

Meanwhile, a survey has found that contrary to the bad publicity that landlords attract that most tenants are satisfied with renting their home.

The findings come from the think tank, Social Market Foundation, who found that 81% of tenants say they are happy with their current home, and 85% of respondents are satisfied with their landlord.

One of the report’s authors, Aveek Bhattacharya, said: “The majority of renters, in contrast to horror stories in wide circulation, are satisfied with their living conditions and have a good relationship with the landlord.

“It’s right the government seeks to help those with unprofessional landlords and poor standard accommodation.”

The foundation says their findings are contrary to the narratives that suggest that renting in the UK is an unhappy experience for many people.

However, the biggest source of dissatisfaction for 34% of tenants, is that they are a renter.

Unhappy living in the private rented sector

The foundation says that this suggests that when someone is unhappy living in the private rented sector, it’s not about their living circumstances, but more about them having to rent rather than owning their own home.

The research also reveals that only half of tenants say they expect to leave the rental sector in the next 15 years, which suggests that a large number of tenants will be renting for a long time.

And by doing so, landlords will see the average age of their tenants increasing, with more than half of private rented homes having someone aged over the age of 45 by 2035.

Also, families and couples look set to make up a growing proportion of tenants.

Renters who have a negative experience of renting

The SMF says that it acknowledges that there is a minority of renters who have a negative experience of renting, and they are supporting measures in the rental reform White Paper that will see the introduction of a decent homes standard and the abolition of no-fault evictions.

Among the recommendations is for an innovative ‘deposit builder ISA’ to help renters build a deposit to buy their own home.

In their recommendations to the government, the SMF also says:

· Tenants support a fixed minimum tenancy contract length - 69% want this to be 24 months

· Give tenants more control over their home - make it easier for them to carry out reasonable alterations and keep pets

· Increase landlord accountability - recognise good landlords with the ‘Good Home, Good Landlord’ kitemark scheme

· Improve private rented property standards - offer landlords tax incentives to invest in home improvements, including green improvements.