Good news for first time buyers, bad news for renters
Up to 380,000 landlords looking to let go of property
A significant number of homes suitable for first time buyers could flood the market in the coming year as new figures* show approximately 380,000 landlords (19 per cent) intend to offload property.
The figures indicate that 45 per cent of landlords who intend to sell property in the coming year plan to sell individual flats and apartments, with a third (33 per cent) looking to sell terraced homes – both of which are typically affordable and attractive options for those taking their first steps on the property ladder.
Significantly, just seven per cent of landlords who plan to sell say they intend to sell to other landlords, signalling renewed hope for many first time buyers and homeowners looking to progress up the property ladder.
The figures, from the National Landlords Association (NLA), come as separate findings from UK Finance shows signs of buoyant first time buyer activity of late**.
Richard Lambert, CEO of the National Landlords Association (NLA), said:
“These findings sound like positive news for potential new homeowners, but the reality is not everyone wants, or is in a position financially, to buy.
“In fact, if all these homes are sold as planned then it will lead to a significant fall in the supply of property available to those who choose to rent, or have no other option but to rent”.
The National Landlords Association (NLA) says it has been looking into the issue recently and has produced a video and discussion paper – the hustle for homes – about the relationship between landlords and first time buyers in the market.
Mr Lambert added:
“Everyone seems to have a gut instinct about the extent to which they feel landlords and first time buyers compete for homes in the UK, but homeownership is a highly emotive issue so the facts are often overlooked.
“There’s certainly no denying that competition exists, but the significant barriers to homeownership are more likely to be the high cost of a deposit or ability to access mortgage finance.
“With our new video and discussion paper we hope to provide more of an accurate picture of these issues, and importantly we want to focus the debate on what can be done to ensure that everyone has a roof over their head - regardless of whether they rent or own”.
Watch the hustle for homes and read a copy of the discussion paper at www.landlords.org.uk/news-campaigns/news/the-hustle-homes
*NLA Quarterly Landlord Panel – April 2018 (1043 respondents)
Gary (not real name), a landlord in Edinburgh, says he is plans to sell up due to recent tax changes:
“I'm selling six flats right now so I can bring my debt down because we won't survive these tax changes, it's just not possible.
“We're trying our best to charge a reasonable amount of rent, but when we sit down and do the figures, you're sitting there going 'this is just crazy' - it's broke our spirit an awful lot.
“I always thought as I got old, I would be able to sell my business for somebody else to take on, but with all these tax changes I personally don't think in 25 years there'll be buy to let landlords, there will be these new corporations that build houses.
“It’s taken something like 22 years to build up the business but I now realise that now we're going to lose probably half of it. I think it's a big, big mistake this tax change. It's a tenant tax, that's all it is”.