One in five landlords plan to reduce their buy-to-let portfolio

Buy-to-let landlords remain unconvinced by the government’s latest plans to improve the rental sector, with almost one in five planning to reduce the size of their buy to let portfolio as a result, while the fast-changing macroeconomic environment is also deterring investors from investing in the sector.

Almost three in five – 60% – landlords say they are preparing to increase rents to compensate for higher costs, with a fifth saying they are planning to sell some of their portfolio to directly combat the cost-of-living crisis. Around a third say they are looking for ways to make their properties more energy-efficient to combat rising fuel costs.

The study, which was carried out by Handelsbanken, illustrates the impact that rising energy bills and the cost-of-living squeeze are having among smaller professional landlords.

The study also shows that more than a third (34%) are cutting back on buying properties in cities as the market adjusts to changing employment practices, as more people are working from home.

Almost all – 93% – respondents say the current market outlook has impacted their portfolio/ investment strategy in some way, with more than half (53%) concerned they will experience more void months. The bank’s previous research on the impact of the Covid pandemic on void months, found that more than 40% of landlords had experienced more void months than usual, so the prospect of further vacancies will be of concern.

Some 21% of landlords report that one or more mortgage deals have fallen through, with two in five – 40% – adding their lender has increased the loan rate on one or more properties in their portfolio.

As a result, 45% say they are planning to purchase lower-value properties to remain under the Stamp Duty Land Tax (SDLT) threshold to combat rising costs. There could also be knock-on effects on tennants as a quarter of landlords say the current economic enviroment will affect the maintenance and refurb programmes of their portfolios.

James Sproule, UK chief economist at Handelsbanken, said: “The property market is entering a period of increasing uncertainty, with house prices in some areas already falling and a rising regulatory burden being seen by some landlords as a reason to reduce their exposure to the market.

“While the ongoing cost of living crisis might be seen as the driving factor in the buy-to-let market, equally important are the post-pandemic movement back into cities, potential buyers delaying purchases and thus looking to rent, and fewer properties, meaning those who do persevere, are likely to see higher yields.

“Savvy landlords are using the changes to SDLT to cost-effectively reshape their portfolios and invest in energy efficiency, something which has become an ever-greater concern of potential tenants.”



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  1. Vanessa Warwick

    I wonder when the penny is going to drop for the government that private sector landlords are desperately needed until such times as they solve the lack of social housing and other housing tenures in this country? I read an article this week where a Build to Rent developer admitted that it would take at least 10 years for the BTR sector to gain traction and build enough homes to fill the void left by private landlords departing the sector. We need affordable new homes NOW, not in 10 years time!  Until then, private landlords are needed otherwise we are going to see a growing wave of homelessness imho.

  2. Woodentop

    We expect 80% of landlord to sell up in 2023 quoting too much hassle, why do I bother, its not worth it anymore, killed the flame.

  3. AcornsRNuts

    MrGove is no friend of the PRS so why wouldn’t landlords sell up.  We only had three rental properties.  One was sold last year and another will be sold in early 2023, with the last one being sold in 2024.


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