UK Landlord Confidence Plummets
The confidence among landlords in the UK has reached a record low, a survey reveals.
According to a survey from BVA BDRC, a landlord's confidence in capital gains from their property investments has fallen from 32% in the second quarter of last year to 23% this year.
Also, their confidence for rental yield growth has fallen 10% to 39%, the lowest it's been for more than nine years.
However, while landlords remain pessimistic, the survey highlights that the market fundamentals are resilient after unprecedented change in recent years.
The survey also reveals that the proportion of landlords who make a profit fell by 1% between the first and second quarters of this year and 4% of landlords say they make a loss.
Landlords say they can make a full-time living
Property investment still offers opportunity with one in three landlords saying they can make a full-time living from their lettings business and 53% say they are able to supplement their day job income.
Landlords also say that tenant demand is increasing around the country with the South East and London being the only regions where demand is falling.
Aldermore's director of mortgages, Damian Thompson, said: "The private rental sector plays a big part in the housing market, so it's a concern that many landlords have a bleak outlook.
"We've seen buy to let lending last year increase by 4% on the year before, buoyed by remortgaging, and lending this year has been on a par with these volumes."
He added that the growing levels of activity reveal that the market may not be in decline but in a state of change as landlords diversify from having a growth strategy towards professionalisation.
The survey also revealed that landlords' confidence in the economy and the rental sector overall has declined with 15% of landlords being optimistic about the private rental sector - down from last year's figure of 21%.
Call to improve PRS regulation
Meanwhile, a call has been made to improve standards and transparency in the UK's private rental sector to boost the relationship between landlords and tenants.
The call comes from the Royal Institute of Chartered Surveyors (RICS) who say that the PRS has the highest proportion of homes failing to meet the decent homes standard.
Now RICS wants the government to support the Regulation of Property Agents Working Group to deliver minimum standards for landlords and agents and the accreditation of practitioners.
A spokesman for RICS said: "We believe the way to improve standards is to ensure that individual lettings, property and estate management practitioners and firms are regulated and subject to regulatory functions from selected designated professional bodies."