How do landlords selling up impact the rental market?

[Rispa42]

Genuinely curious because it’s been said that one of the reasons the rental market is heating up is because BTL landlords are selling up, and therefore leading to an imbalance between supply and demand. However, if they sell, they’d either sell to another landlord (therefore not impacting supply) or to a FTB who was previously renting (therefore reducing ‘demand’). What am I missing?

Or someone for a second home.

This is slightly simplistic view I think the rental market is heating up as in there are not enough rentals to support the people who need homes. When there is a shortage of anything the price goes up Hampton estimate 28000 landlords are exiting each month due to market pressure mortgages going up and the never ending pressure the government are placing on the sector. For all the people who say great the less landlords the better I think in 5 years you will think differently - the main acquirer of homes now is Lloyds closely followed by John Lewis.

Because due to the complexities and timings of rental contracts, some landlords who are selling up are turfing out renters so that they can sell with vacant possession - leading to a glut of unused properties on the market.

Landlords are also not entering the sector as before which will lead to less choice and higher rents

Net inward migration to UK last year was 606,000 which is close to another Sheffield.
I don’t think they’re all buying houses.

True, and if the EPC rating of a rental property of C or above comes into law in 2025 (I'm guessing it won't) that will mean even less rental options if a landlord refuses or is unable to adapt the house.

Will that just mean that properties will just sit empty?

@Rispa42 because the government has introduced this unworkable bullshit of aspirational C which is unachievable with Victorian stock this has made landlords leave the sector too so when a perfectly good tenant is given notice to quit as it will be illegal to rent a property below a C I wonder where they all will go ?

Houseshares and HMOs tend to be more densely populated, especially on the slumlord scene. So if those houses get sold and become single family homes, you will get a net loss.

Also, anecdotally, some landlords seem to have put their houses on the market but can’t get the price they want, so those homes are sitting empty at the moment.

Probably to a John Lewis managed / conglomerate 🙄

I think in some places a lot turn into short term rentals/ air bnbs.

It's not a 1:1 offset OP. Simply put there is a shortage of rental housing, and if more is sold up the shortage only gets worse.

There are 4 flats trying to sell in my block. Was 5.

The one that sold went to a new owner occupier.

The other 4 are still for sale.
Unless there is a significant drop in house prices (eek) properties are still too expensive for first time buyers in central London.

Why would John Lewis or Lloyds owning these properties and renting them out be worse than Joe Bloggs private landlord renting them out?

And 2 of the flats that are for sale are BTL.
1 is a pied a terre
1 is a home.

The one that sold was a home.

Just realised this reads badly. Of course renters live in a home.

What I meant was they were owner - occupiers ie. not people trying to leverage investment cash.

Makes sense!

thanks all - illuminating thread… kind of worrying where all this is heading.

More landlords selling up means extra households coming into the market. Because they need a new home before the landlord’s home has sold. The landlord sells an empty home.

Whereas for owner occupiers selling, it’s usually one occupied home moving to another occupied home. It’d normally only be unoccupied if the owner had died, emigrated, moved into care and so on.

I wonder this as well. I’d assume corporate landlords would be more likely to obey legislation. More cost effective maintenance as could be done in house. Deeper pockets for necessary repairs/ refurbishment. I dont have a problem with landlords making a profit in exchange for providing somewhere decent for people to live.

It can be done, and I’ve done it but it requires stripping it back to brick and insulating under the floors, internal wall, and pitch roof and it’ll cost pushing £100k..

so on balance landlords don’t want to know and are selling.

@Badbudgeter @ThreeFeetTall they will be more expensive and they are immune from having to have a C grade just like councils and Housing associations. I have four tenants only one would pass an affordability test the others I went on my gut instinct as I have done for 25 years they would not get passed to rent. There is already a pressure on tenants there are no homes to rent the government are totally insane

I think property is still too expensive for many FTB's to afford, so I don't necessarily think LL will always sell to FTB. Plenty of downsizers, re-locators etc wanting to rent.

That means fewer properties available to rent.

Not enough social housing.

Not enough building of new properties to rent out.

Not enough profit for anyone bring a LL - whether that's an individual or a big business.

I don't see any evidence of big conglomerate rentals up here in Scotland- maybe it's a thing down south?

Either way, it's a perfect storm of conditions for anyone trying to rent & the LL's selling up.

That’s a good point - would be curious how they are as landlords vs a private one

I can only assume you have missed the various articles and threads about what shit landlords many HAs are.

@jenandberrys that little boy who died from mould inhalation was a HA tenant