Landlord News

Landlords increasing rents and reviewing portfolio sizes

Ryan - August 30, 2017

A rising number of landlords are selling off their properties and raising their rents in response to regulatory alterations and political uncertainty. These actions are in a direct response to the Brexit and General Election results.

19% of landlords with 20 or more rental properties has reduced the size of their rental property, according to a new survey from BDRC Continental – on behalf of Foundation Home Loans.

Portfolio Reduction

38% of landlords quizzed said that they had reviewed the size portfolios to make sure they could withstand rising costs. 7% said that they have sold off their properties, in order to reduce portfolio sizes or to diversify.

Apart from political uncertainty, a number of landlords have been deterred by recent tax alterations, including the 3% Stamp Duty surcharge and changes to mortgage interest tax relief.

The percentage of UK landlords who reviewed their portfolio size by region following the results were:

UK 38%
East of England 40%
East Midlands 50%
London (Central) 45%
London (Outer) 40%
North East 43%
North West 34%
Scotland 35%
South East 40%
South West 38%
Wales 32%
West Midlands 35%
Yorkshire 28%

Rent Rises

Landlords in the East Midlands were found to have raised rents the most, with 41% here choosing to do so, more than the total average of 30%.

By region, the largest rent rises were recorded in:

UK 30%
East of England 33%
East Midlands 41%
London (Central) 24%
London (Outer) 24%
North East 23%
North West 35%
Scotland 15%
South East 33%
South West 31%
Wales 23%
West Midlands 31%
Yorkshire 31%
Landlords increasing rents and reviewing portfolio sizes

Landlords increasing rents and reviewing portfolio sizes

Nearly three quarters (71%) of landlords said they had seen a fall in confidence.

Jeff Knight, Marketing Director at Foundation Home Loans, noted: ‘Landlords have been met with a raft of changes, from stamp duty charges to shifts in tax policy, and the lack of certainty on the political front has clouded the picture somewhat. The response has been to ‘batten down the hatches’, streamlining larger portfolios and protecting income by increasing rents – decisions that can be reviewed once the buy to let market is more accommodating.’

‘The fact remains that, whether it’s as a stepping stone to home ownership or a longer term lifestyle decision for tenants, the rental sector is an increasingly important part of the housing mix. This will ultimately be best served by a wide choice of property, and good landlords who can have confidence in decent returns.’[1]