Research by franchise lettings agency company Belvoir suggests that landlords are continuing to exit the property market, although not at the rate anticipated by previous studies.
“Statistics show a slight increase of 48 to 52 per cent of landlords selling up to three properties and a similar number of landlords selling between four to five properties compared to the second quarter of the year” explains chief executive Dorian Gonsalves, reviewing the company’s data for quarter three.
“There was a decrease from 17 to 12 p[er cent for landlords selling six to 10 properties. Two years ago 10 to 18 per cent of offices were reporting no sales of landlord properties, but this figure has now fallen to between four and five per cent. Overall, our conclusion is that the number of landlords selling properties is increasing, albeit not at the rate that some research has suggested” says Gonsalves.
“The main reasons for landlords exiting the market are tax changes, constant regulation and increasing legislation, landlords moving back in, and lower investment returns, as well as uncertainty over Brexit, and what this will mean for the market.
“When selling properties, only 19 per cent of offices reported properties being sold to first time buyers as the government hoped, however, according to our survey, 33 per cent of offices reported properties are being sold to other landlords and 23 per cent are general sales. This suggests the government’s plan to increase home ownership by reducing the attractiveness of buy to let isn’t necessarily working.”
The figures suggest no real change in void periods during the third quarter; eviction rates also remain extremely low with over 50 per cent of Belvoir offices carrying out zero evictions in Q3.
“Our research shows that tenants tend to stay in their rental accommodation for the length of time that suits them. At the start of the index in 2008, most offices reported that the majority of people stayed for 13 to 18 months. This year we have, until this latest quarter, seen an increase in those renting for 19 to 24 months, suggesting two-year tenancy agreements are probably more likely to be what tenants would prefer, rather than the three-year agreements that were being discussed by policy makers earlier this year” concludes Gonsalves.