Landlords likely to sell as confidence drops to ‘all time low’ – TMW

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  • 26/05/2020
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Landlords likely to sell as confidence drops to ‘all time low’ – TMW
Landlord confidence in the future of their own letting business has fallen to record low levels, The Mortgage Works’ (TMW) first quarterly Buy to Let Barometer has found.

 

According to the research, which was compiled using BVA BDRC’s Landlords Panel in April, just 19 per cent of landlords said they felt “good” or “very good” about the next three months.  

This is down from the 37 per cent of landlords who felt positive about the following quarter in Q1 2019, and the lowest the measure has been since BVA BDRC first started collecting data in 2007. 

 

Selling up 

More landlords are looking to sell properties than buy, as the research revealed 21 per cent wanted to sell in the next 12 months while 12 per cent plan to buy property. 

This is a one per cent decline on the number of landlords who said they would be selling in the next year, and a two per cent drop on landlords looking to make a property purchase. 

TMW’s barometer found that landlord confidence in capital gains and rental yields had also reached an all-time low. 

Some 15 per cent of respondents said they were confident about their capital gains for the next three months compared to 25 per cent in Q1 2019. As for rental yields, 24 per cent felt confident about the next quarter down from the 46 per cent who responded positively to the question last year. 

According to TMW’s barometer, just 16 per cent of landlords have seen an increase in tenant demand while 24 per cent have seen demand decline. Some 33 per cent said they saw no change. 

 

Pandemic impact

The report was conducted with the responses of 843 landlords between 20 March and 2 April. It asked landlords if they thought the coronavirus pandemic had affected their lettings business. 

It was found that eight in 10 landlords had been negatively impacted by the pandemic, with those in London and the South West being the most severely affected. 

Some 43 per cent of landlords predicted they will suffer financial hardship following the pandemic, and those who are looking to exit the buy to let market the soonest feel they will be hit the hardest. 

Further, the survey found that self-employed landlords thought they would be worse affected with 54 per cent saying the pandemic would have a significant negative impact on them.

 

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