In a remarkable trend indicating potential upheaval in the property market, a sales agency specializing in disposing of buy-to-let portfolios has disclosed receiving an average of 240 enquiries per month from landlords eager to leave the sector. The agency, known as The Landlord Sales Agency, further revealed that the highest percentage of enquiries originated from landlords with portfolios comprising 20 properties or more.
Despite the significant surge in landlords seeking to sell their buy-to-let properties, The Landlord Sales Agency conveyed that 75 percent of its agreed sales over the past 12 months have been to other landlords who intend to retain existing tenants. This finding suggests that a considerable proportion of landlords are relinquishing their portfolios due to reasons other than tenant eviction or dispossession.
One landlord, who recently sold her extensive portfolio of 23 properties in Warrington, shared her motives with the agency. In addition to desiring retirement, she expressed her reluctance to bear the burden of managing multiple properties. Notably, despite the substantial value of her portfolio amounting to £2.7 million, mounting costs and rising interest rates compelled her to subsidize her tenants’ living expenses.
The managing director of The Landlord Sales Agency, David Coughlin, elaborated on the challenges faced by landlords, tenants, and homeowners in the current market. He cited escalating interest rates, soaring bills, and stringent regulations as key factors rendering it financially untenable for some landlords to continue operating. Coughlin recounted the predicament of a landlord burdened with 50 properties, unable to secure refinancing due to lenders’ reluctance. Another landlord, with 40 properties and a staggering monthly mortgage deficit of £6,000, was left with no alternative but to sell. These cases, Coughlin emphasized, are not isolated incidents; on average, over 200 tenants face the possibility of losing their homes.
Given the tumultuous circumstances, The Landlord Sales Agency has taken extraordinary measures to maintain tenancies during property sales. Coughlin revealed that his firm has gone to great lengths to assist tenants by helping them cover current rents, clearing any outstanding arrears, facilitating relocations, and in some cases, even prepaying rents for the subsequent landlord who takes over the property. These efforts aim to support both landlords and tenants as they navigate the challenges presented by the current market conditions.
Coughlin acknowledged the hardships faced by tenants, who, in order to secure rental properties, have had to accept increased rents. He emphasized that in 50 percent of the agreed sales, tenants have chosen to stay in their homes despite the higher rent, recognizing the fierce competition for rental properties that could result in even steeper costs elsewhere.
As the property market experiences this seismic shift, The Landlord Sales Agency finds itself liaising with large portfolio and corporate landlords, tenants, and, in some instances, local authorities to preserve as many tenancies as possible. Coughlin lamented the current state of affairs, remarking that the market is failing to serve the interests of landlords, tenants, and homeowners, leading to a situation where no one emerges victorious.