Landlords Warn Of Selling-Up Over Section 21
Nearly four in 10 landlords say they will sell-up if Section 21 is axed by the government, a survey reveals.
The survey was conducted by Landlord Action who found that 38% of buy to let landlords say they will consider selling properties should the government end Section 21 repossessions. These are the so-called 'no fault' evictions.
Also, 33% of landlords say they will only continue renting out property if significant changes are made to Section 8 rules.
In addition, 70% of landlords say they will be less willing to consider a longer-term tenancy should Section 21 no longer be an available option and 85% say they will be 'selective' over their tenant choice.
'Government efforts could be counter-productive'
The founder of Landlord Action, Paul Shamplina, said: "If Section 21 was scrapped, the government's efforts could be counter-productive and affect vulnerable tenants."
He has now written to Heather Wheeler, the housing minister, to invite her to gain more understanding of the repossession process before undertaking 'drastic legal reforms'.
He points out that the encouraging of longer tenancies will only be a possibility if there's an investment in housing courts to help speed the eviction process up.
He added: "It's clear with so many obstacles facing landlords, including the introduction of more regulation, that there's a possibility that the buy to let sector will significantly shrink over the next five years, which will mean higher rents for tenants."
The Residential Landlords' Association has launched a separate survey asking landlords what a post-Section 21 BTL sector should look like and it has already attracted a record number of replies from landlords.
English landlords head to Scotland to invest
Meanwhile, there has been a big rise in the number of English landlords who are investing in Scotland's buy to let sector.
The research from property training firm Touchstone says landlords are being attracted by lower property prices and higher yields.
The findings highlight that 78% of clients say the best BTL investment opportunities exist currently in Scotland.
The firm's chief executive, Paul Smith, said: "Central Scotland is the focus of activity while Edinburgh provides consistent returns but it's Glasgow that is now the city which is setting the pace."
According to data from Your Move, landlords in Scotland had returns of 4.7% in March and these are now at a six-month high, while yields in England and Wales are 4.3%.