Why are so many landlords now selling up do they anticipate a housing market crash coming?

Durban

I can tell  you.

Section 24 ( tax changes )
Looming end of Section 21
More and more onerous red tape and new laws. 

Proposals in the pipeline that all PRS stock must be a C at EPC.  Most rental properties are a D and will cost thousands to bring to a C and ruin alot of those houses. 

It now takes over a year to evict a tenant through the courts. A long time with no money and your asset getting trashed

I could go on and on but there are a lot easier ways to make money

I have been a good landlord for 10 years with 2 properties and in the process of selling one now. I am a basic rate taxpayer and Section 24 does not affect me and I will still keep the remaining property.

There are many good small landlords like myself who are selling up and it is the tenants who will suffer as there is going to be a massive shortage of good family rental homes and rents are rocketing.  We are already seeing this.

Linton

Deleted_User said:

Durban said:

There are many good small landlords like myself who are selling up and it is the tenants who will suff er as there is going to be a massive shortage of good family rental homes and rents are rocketing.  We are already seeing this.

Either they're selling to other landlords (so no change in the supply of rental homes), or they're selling to owner-occupiers (so there is a reduction of rental homes, but an equal reduction of renters, since when you've bought your own home, you don't need to rent any more).

There would only be a reduction in supply (without an equal reduction in demand) if homes are being left empty (which may happen temporarily during a sale, but only temporarily), or homes are being converted to commercial uses (perhaps in some cases, depending on area and type of home?), or just pulled down (not likely), or sold as a second home (again, perhaps in specific areas?).

But with those limited exceptions, properties don't disappear from the housing supply because landlords sell up.

On the other hand rental accommodation would tend to be at a higher density.  One rental may house several people sharing and renters may be prepared to have minimal bedroom space as they know it is only temporary.  Most house buyers would probably be looking for 3-bedroom properties.

So fewer rental properties could result in a decrease in available accommodation and so an increase in house prices.

steampowered

Durban said:

There are many good small landlords like myself who are selling up and it is the tenants who will suffer as there is going to be a massive shortage of good family rental homes and rents are rocketing.  We are already seeing this.

Also lots of young families who are priced out the market currently, but may be able to buy their own home if it is true that landlords are exiting the market. 

MEM62

I am what is known as an 'Accidental Landlord'.  Basically, we kept my flat when my girlfriend and I bought a house together.  At the time this was not purely a financial decision.  

It will be put on the market in the spring when the current tenant lease ends.  My motivation for selling is that the value is not increasing yet my liability for CGT is.  (In fact, it is currently worth around £40K less than it was at the time we bought the house almost six years ago.)  Unless you get the 'right' tenants, the property is rarely looked after to the standard that I would like - meaning that regular work is required to keep the flat up to standard.  As an investment it is not tax-efficient and I am sure that the circa £300K could work harder elsewhere.  The Government do not appear to like guys like me being landlords and, in addition to the changes already made, I am expecting further legislation that is decidedly unfriendly to people in my position.           

MEM62

jimjames said:

coypondboy said:

Landlords selling up as rising interest rates and inflation kill the market any thoughts if you are a landlord at the moment?

Rent is one item that should be kept in line with other rises so should be able to track inflation, at least over medium term.

The market rate for my property has not changed in nearly six years.  Yet, my tax liability, expenses and running costs have all increased over that period. 

solidpro

BrockStoker said:

Probably just pure coincidence, but I know of a landlord with a portfolio of ~600 houses who is cashing in her chips. I suspect it's just a case of "getting to old and wanting to have less stress".

For me personally, ~450 houses is enough.

solidpro

MEM62 said:

I am sure that the circa £300K could work harder elsewhere.  

Such  as?

Chris_English

And still the OP hasn’t bothered to actually link to any evidence that this is happening.

EssexHebridean

Looking at his posting history, it's unlikely he will. 

DoublePolaroid

solidpro said:

MEM62 said:

I am sure that the circa £300K could work harder elsewhere.  

Such  as?

I’m answering for myself rather than MEM62 but I’m in exactly the same position as them and my reasoning is near identical. 

Money where my mouth is, I fully expect the proceeds from the sale of a two bedroom flat in outer London suburbia, invested into 100% equities via index tracker over twenty years, to be worth more than the value of said flat in 20 years + cumulative rental income - mortgage interest - sundry costs. I could be wrong, but even in that case I can comfort myself in the fact that my non-property investments don’t call me to tell me that my boiler is broken and I need to fix it on a Sunday night.