You may have seen the headlines about how many properties and landlords have left the PRS over the last few years, and in 2023, this trend is continuing. Perhaps you're considering selling your buy-to-lets this year.
In this article, we'll dive deep into the factors affecting landlords, and why 1 in 5 are considering offloading 1 or more properties this year.
Why the big sell-off?
One of the main reasons for this trend is the economic uncertainty caused by Brexit. The UK's decision to leave the European Union has led to a great deal of uncertainty in the country's economy, and many landlords have become hesitant to invest in property due to the potential risks involved. Additionally, the after-effects COVID-19 pandemic has also led to economic uncertainty, with many landlords selling their properties due to the economic downturn we're currently experiencing.
New regulations
Changes in regulations have also played a role in this trend. The UK government has introduced a number of new regulations aimed at protecting tenants, such as caps on rent increases and the introduction of "no-fault" eviction procedures. These regulations have made it more difficult for landlords to make a profit on their properties, leading many to sell their properties instead.
The Renter's Reform Bill is still set to come in at some point this year, and many are selling in time for the changes. Speak to us below if you're wondering how the bill could affect your property portfolio.
The shifting property market
Finally, shifting market conditions have also contributed to the trend of landlords selling their properties. Property prices have been increasing in recent years, with many landlords selling their properties in order to take advantage of these high prices. This trend has been particularly pronounced in London and other major cities, where property prices have been rising at a faster pace than in other parts of the country.
What's more, significant capital gain tax changes are coming in from April, which will see your tax-free capital gains capped at £6,000 down from £12,300, and then down to just £3,000 from April next year.
Conclusion
Overall, there are many factors that have contributed to the trend of landlords selling their properties in the UK. Economic uncertainty, changes in regulations, and shifting market conditions have all played a role in this trend. However, landlords are also taking advantage of high property prices and cashing out to make a profit, which is the most common reason for selling the property. This, and avoiding higher overheads with new legislation changes.
If you're affected by any of the issues above but don't want to sell your property, click below and schedule a time with a member of our expert property management team and they will be able to assist you and advise you on your options.
