Landlords Selling Up
7th June 2023
7th June 2023
Jonathan Bourne is a client of mine and he’s totally fed up with the buy to let business.
He’s no accidental landlord and investor and began buying homes 20 plus years ago in London and accumulated a portfolio of 25 properties. Importantly, all of these properties are owned in his own name rather than a limited company.
Whilst he’s slimmed down his portfolio over the last few years, the growing tax burden, higher borrowing costs and compliance regulations mean he’s absolutely determined to get out of the
industry completely over the next 12 months.
Jonathan isn’t alone!
A ‘shock’ poll by bridging finance provider Finbri shows that 45% of all UK landlords plan on slimming down their portfolios. The climbing cost of finance is the last straw with an estimated quarter of homes available for sale in London being disposed of by landlords.
According to the property gurus at Zoopla, buy-to-let investors in London are selling their properties faster than anywhere else in the country.
The combination of higher mortgage costs, pesky taxes and low rental yields has taken a toll on their profits, making the landlord game simply unviable for many.
Lee Karasavvas, the big cheese at Prolific Mortgage Finance, spilled the beans and said that the government's tax crackdown on the buy-to-let sector is finally catching up with adventurous landlords. They used to balance the scales with low interest rates, but as costs go up, they're saying, "Adios, amigos!" and selling their lower-yielding properties to divest into pensions and even cash on deposit.
And wait, there's more! Landlords are even selling properties with lousy energy efficiency. They're beating the government to the punch before the planned introduction of minimum Energy Performance Certificate requirements for the rental sector.
Who wants to deal with upgrades when you can sell it off and let someone else worry about it, right?
I hope this helps!