2-minute read
A quarter (26 per cent) of landlords are looking to sell at least one buy-to-let property next year, according to new research by Simply Business.
In real terms, this could mean over half a million homes are put up for sale.
With the research also suggesting that over 80 per cent of landlords won’t be looking to take on any more buy-to-let investments, how will this affect the property market?
The primary reasons landlords are saying enough is enough are, probably unsurprisingly, tax increases and government reform.
One of the main culprits is the shifting goalposts of House in Multiple Occupation (HMO) licensing, with more than 10 per cent saying this was a factor in their decision. There have been new rules on room sizes and a ban on charging tenants admin fees.
Other reasons include:
Your email address will be used by Simply Business so that we can send you the latest guides, offers and tips. You can unsubscribe from these emails at any time. For more information, check out the Simply Business Privacy policy.
Many landlords, it seems, are no longer able to maintain their profit margins, with over a third (35 per cent) reporting a decrease in their rental yield in 2019.
Responses to the survey revealed that well over a tenth of landlords have experienced a rental yield decrease of at least five per cent.
Decrease in rental yield | Percentage of landlords affected |
---|---|
0-5 per cent | 20 per cent |
5-10 per cent | 9 per cent |
10-15 per cent | 3 per cent |
More than half of landlords (52 per cent) are hopeful that rental yields will increase next year, while over a quarter (27 per cent) are less optimistic and believe a further decrease is coming.
A fifth (18 per cent) of landlords are expecting a rental yield decrease of 0-5 per cent, 6 per cent think they’ll go down by 5-10 per cent, but only 2 per cent believe there’ll be a decline of 10-15 per cent.
If declining rental yields, government reforms, tax increases, and the rising cost of owning a rental property are making you think seriously about selling up, there are a few things to consider.
Selling a buy-to-let property is a big decision, so make sure it’s the right one for you.
What do you think will happen to the buy-to-let market in 2020? Let us know in the comments below.
Over 200,000 UK landlord policies, a 9/10 customer rating and claims handled by an award-winning team. Looking to switch or start a new policy? Run a quick landlord insurance quote today.
Start your quoteWe create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer
Keep up to date with Simply Business. Subscribe to our monthly newsletter and follow us on social media.
Subscribe to our newsletter6th Floor99 Gresham StreetLondonEC2V 7NG
Sol House29 St Katherine's StreetNorthamptonNN1 2QZ
© Copyright 2022 Simply Business. All Rights Reserved. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG.