Landlords STILL Looking to Sell
Landlords are STILL looking to leave the industry, why?
If you’re looking to BUY rather than SELL – let us know! We know plenty of experts who can help to smooth the process and help you towards the best deal.
We’ve mentioned before that demand is outstripping supply in the PRS due to landlords selling up and quitting the industry. And now that is hitting the headlines again. But why? Could it have anything to do with crackdowns promised by a re-elected Labour Mayor? And is that an indication of Labour’s intentions, should they win the upcoming election?
Landlords Leaving the Sector
Knight Frank is warning that landlords are preparing to sell up ahead of the upcoming general election.
Tom Bill, Head of Research at Knight Frank said that there are:
early signs that more landlords are considering a sale. The number of new lettings instructions across London was 4% lower in April compared to the same month last year, Knight Frank data shows.
At the same time, sales instructions were up 16%.
In recent years, landlords have cited the increasing red tape and rising tax costs as reasons for leaving the sector. If they haven’t sold up, they’ve tended towards shorter tenancies to give themselves the flexibility to sell up if they want to.
Despite the Renters Reform Coalition withdrawing their support for the Rental Reform Bill, landlords aren’t that happy with it either, feeling that it is designed to support tenants more than them. With landlords leaving the sector over the last few years due to ‘increasing red tape,’ it’s not surprising that some landlords may feel the Bill is the straw that broke the camel’s back.
Cost of Rent Day
But landlords leaving the sector can also be viewed as TERRIBLE news for tenants, particularly London based tenants who, according to new research from the Adam Smith Institute, are already working 197 days a year, just to make their rental repayments. With more landlords leaving and fewer properties to rent, competition is only going to get more ferocious and drive the costs up more.
The Adam Smith Institute found that the average ‘Cost of Rent Day’ in 2024 was 5th May. This means that the average renter in England has earned enough – BEFORE tax – to cover their annual rent bill. But for London based renters, this day isn’t due until 16TH JUNE!
Again, that’s BEFORE tax, so it’s a pretty bleak affordability picture.
While some have stated that the slowdown in rental price growth is another reason for landlords to leave the sector, we’d like to offer an alternative view. At a time of rising costs, from what you put in your fridge, to the cost of running that fridge, a landlord wants to know that rental arrears is not going to be an option. Ever increasing rental prices could eventually see you facing rental arrears more often or even void periods, as tenants are unable to afford the property.
So take a step back and take a longer view about covering your costs during this tighter financial time. We’d also really recommend that you get a professional on your side and work with an experienced letting agent to get you the right price and, more importantly, the right person in your property. Let them worry about valuation, marketing and referencing.
Labour Crackdown
A newly re-elected Labour Mayor may give some insight into Labour’s housing plans, should they win the upcoming general election.
Andy Burnham, who was re-elected Mayor of Greater Manchester, has pledged a crackdown on rogue landlords. No good landlord will have an issue with that, as rogue landlords are what give great landlords a bad name.
But Burnham has other housing plans and he laid them all out in the Guardian. In order to solve the housing crisis, he wants to:
- Suspend Right to Buy policy from any new council homes built in the city-region
- Build new council homes in all 10 boroughs of Greater Manchester
- Bring in a new Good Landlord charter
- Give renters the right to request a property check.
- Tougher enforcement against landlords who rent out unfit homes
Mr Burnham feels that one of the main reasons why the country hasn’t built enough social housing is because of the right to buy policy, there is no incentive for councils to build new homes. He also feels that the death of Awaab Ishak in Rochdale underlines the necessity to enforce a high standard in homes in both the social housing sector AND the PRS.
Do you think Labour is taking the right approach in Manchester? Or are you ready to pack it in and sell up?
