The poll conducted by Finbri comprising 1,001 landlords revealed that 44 per cent of those asked will dispose of their properties if the Monetary Policy Committee makes this move at the next meeting in May.
Although inflation fell in March, it still remains high and well above the central bank’s two per cent target at 10.1 per cent, causing many to predict that the base rate could reach five per cent this year instead of peaking at 4.5 per cent.
Among the landlords who said a higher base rate would prompt them to sell, this was true for 37 per cent of the 140 landlords with one property as well as 45 per cent of the 861 with two or more properties.
Some 45 per cent of the respondents said they would turn to other investment opportunities, citing the difficulty to make a profit in the high rate environment. A further 52 per cent will increase rent to cover any additional expenses.
Just 30 per cent of respondents said the rental yield of a property was either not important or somewhat important, with the majority indicating that it influenced their investment. A similar segment said the capital appreciation of their properties was either somewhat important or not important at all.
Landlords buying again
Some 45 per cent said they would invest in the property market next year, while a quarter were unsure and 30 per cent said they would not. A similar segment, 44 per cent, said now was a good time to invest in the property market, but 24 per cent were undecided and 32 per cent said now was not a good time to invest.
Trouble finding new properties to invest in was highlighted, with 53 per cent of respondents saying they struggled to source properties.
As for wider economic influences, 49 per cent of respondents were either strongly concerned or concerned about interest rates, while 19 per cent felt optimistic. Some 16 per cent were neutral on the matter while 15 per cent were very optimistic.
Some 51 per cent of respondents were concerned about inflation, while 46 per cent were worried about the potential of a property crash.
A further 45 per cent said upcoming EPC legislation worried them and 44 per cent were concerned about Capital Gains Tax Allowance.
Stephen Clark (pictured), co-founder of Finbri, said: “The combination of rising interest rates, successive hostile legislative and regulatory changes places significant burdens on private landlords.
“With reduced rental stock in the market and booming demand, those properties that are available have even higher rents which is a source of great concern for renters.”
