Sunday, February 25, 2024

Large number of private landlords leave UK rental market

The number of private landlords leaving UK rental market has soared in April

The number of private landlords leaving UK rental market has soared in April, according to lettings group Arla Propertymark. It said that letting agents saw the number of landlords selling their buy-to-let properties in April reach highest levels since records began in 2015.

While the number of landlords exiting the market increased, the demand for rental homes also increased. The number of landlords exiting the market rose to five per branch, up from four in March, whereas the number of prospective tenants registered per member branch increasing by nine per cent.

The figures from Propertymark come after data from the National Landlords Association (NLA) released earlier this month showed that 380,000 buy-to-let landlords are looking to offload their property in the next year. The NLA data showed that around a fifth of the UK’s landlords are looking to sell, and that nearly half (45 per cent) of those selling would be offloading a flat or apartment.

Despite the potential flood of properties, rents in the UK are still going up, according to Propertymark. In the highest figures since September 2017, 26 per cent tenants experienced rent hikes in April despite the fact that the number of rental properties available remained unchanged.

Arla Propertymark Chief Executive, David Cox said the barrage of legislative changes landlords have faced over the past few years, combined with political uncertainty has meant the buy-to-let market is becoming increasingly unattractive to investors.

Landlords are either hiking rents for tenants or choosing to exit the market altogether to avoid facing the increased costs incurred.

According to Dominic White, CEO of London-based KCR residential, figures like these may be a sign of transformation in the UK market towards a more institutional private rented sector (PRS) model with large, commercial property managers rather than small private landlords. The professional management teams can both optimise operating costs and deliver a high-quality living experience to tenants, something that is impossible to do on a small scale.

White added that additionally, the working population is becoming more mobile, jobs change more frequently, society is more transient – flexibility is key. People want quality well located housing with accessible rents – to achieve this PRS needs to be owned by large scale professional operators, investing in purpose built, well managed buildings, with a strong focus on customer experience.

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