In a recent survey conducted by e.surv, it has come to light that landlord interest in the buy-to-let market is dwindling. The comprehensive study, involving the input of more than 500 valuers and surveyors, has exposed a striking trend: a substantial 79% of surveyors have observed a marked decline in landlords’ enthusiasm for acquiring fresh investment properties. Furthermore, approximately half of these surveyed professionals have noted a surge in landlords who are either seeking to consolidate their property holdings or, in some cases, entirely withdraw from the market over the past year.
The findings have raised concerns at e.surv, who stated, “These challenges could have several implications for the UK housing market if left unaddressed, including a reduction in the supply of rental properties and an increase in rent for tenants already facing a cost-of-living crisis.”
With the demand for rental properties consistently outstripping supply across the UK, 44% of those surveyed have reported a drop in the availability of rental properties on the market. This surging demand has led to properties being snapped up at a rapid pace, frequently at or above the listed price, particularly in bustling rental markets. This phenomenon is most evident in London, where 45% of surveyors have observed rentals being finalized above the asking price. Additionally, 40% have reported significantly shorter rental timelines.
Rob Owens, e.surv’s Head of Research, commented on these findings, stating, “The buy-to-let market is grappling with several challenges at present, with rising mortgage rates topping the list of concerns for landlords. This has resulted in a decline in landlords participating in the sales market and an increase in landlords seeking to streamline their portfolios or exit the market entirely.”
He further emphasized, “These challenges could wield a substantial impact on the UK housing market, leading to a decrease in the supply of rental properties and driving up rents for tenants. It is crucial that the government takes proactive measures to support the buy-to-let market and ensure its viability as an investment option for landlords.”
On the sales front, the survey has indicated a consistent influx of homes available for purchase this month. However, these properties are tending to linger on the market for extended durations, with top-tier market prices feeling the pinch. Additionally, incentives for new builds are becoming increasingly prevalent, frequently revolving around costs associated with purchasing, such as deposit contributions, assistance with legal fees, and contributions toward stamp duty or land tax.