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Half of the tenants who left a property last year were forced to do so because their landlord wanted to sell the property, suggesting that a significant amount of private rental stock is being lost.
Meanwhile, the majority (66.7%) of homes sold by landlords are purchased by first-time buyers.
In a survey by rent payment platform PayProp, 50% of real estate professionals said the main reason tenants move is because the landlord is selling the property.
Neil Cobbold, PayProp’s UK managing director, said: “The loss of equity and cash-rich tenants has put PRS under pressure, with fewer homes to rent and a lot of pent-up demand from less affluent tenants. “This could result in a business crisis.” Rental prices may rise as there is competition for the remaining properties.
“The question we should be asking is, ‘Why are so many landlords selling their properties?'”
According to the UK Private Landlord Survey, the age of the typical landlord is one factor, they are on average 58 years old, so they are thinking about using the money tied up in the property for their retirement. There is a possibility.
Otherwise, a lack of profitability, including a lack of mortgage income tax relief, higher buy-sell mortgage rates, increased regulation, and the potential repeal of Section 21 evictions are all factors.
Cobold added: “If the trend of declining PRS properties is to be reversed, the government must find ways to keep landlords in PRS and encourage more investors to join the sector.” Ta.
“Otherwise, supply will continue to be squeezed and rents will continue to rise, making life even harder for tenants who are already feeling squeezed.”
The government touted the Renters (Reform) Bill as the most sweeping reform of PRS in a generation, and it dominated coverage in the trade press.