Rental home scarcity increase as one third of landlords set to quit
Research carried out by Aldermore suggests that nearly a third of landlords of thinking of quitting the private rental sector. This decision is said to be pushed by rising maintenance costs and the introduction of tighter regulations.
Property Industry Eye says, “Nearly seven out of 10 (69%) landlords say that private landlords exiting the market would hurt the quality of properties.”
What is bringing landlords to the brink of quitting?
Property118 says that, “34% of landlords point to soaring maintenance costs as a primary concern, matched by an equal number who are worried about the impact of the impending Renters’ Rights Bill.
“Also, 29% are influenced by the stamp duty increase for buy to let properties, announced in the Autumn Budget, pushing them towards selling their investments.”
Threats to the private rental sector
If these landlords carry out what is to be expected, then it could place further strain on private rental properties due to shrinking numbers being made available.
As tenant demands increase and housing options available decrease, students – second and third years in particular - trying to find homes will also feel the pressure as they may find it harder to find a private house.
According to Property Industry Eye, “seven out of 10 (70%) who recently moved reported that it felt like they were competing with more people when looking for a property.
“One in four recent movers (27%) have had to move as their landlord sold the property that they previously lived in.”
Due to scarcity of PRS homes, tenants can expect an increase in rent as a result. This promotes new worries for tenants of having to move home or share larger houses with more tenants.
Landlords selling up
Property118 reports that action has already been taken by some property owners, 29% of which have “disposed of part of their holdings over the past year, averaging a 32% reduction in their portfolios.”
All of this is occurring despite a surge in tenancy demand.
However, landlords are feeling as though they are being blamed unfairly for issues that they don’t have a lot of control over. The issues stem from much broader problems and for some, selling up in the face of rising maintenance costs is just the best option for them.
Renters’ Rights Bill
Jon Cooper, director of mortgages at Aldermore, said: “Aldermore welcomes the government’s efforts to increase transparency within the sector and recognise the role that good landlords play through the Renters’ Rights Bill, but this must be done in a way that is proportionate and does not create undue additional strain on landlords.”
