Landlord News

Landlords Have Been Selling Off Property

It has been reported by the Association of Residential Letting Agents (ARLA) that the number of landlords selling property increased from 6% to 8% in the fourth quarter of 2011.

Furthermore, the number of people who bought properties also increased from 23% to 25% during the same period. This has suggested that landlords have focused on amending their property portfolios over the past year.

Landlords in the North-West of England were seemingly the most active during 2011 as almost a third bought at least one property during the year and 11% sold at least one property.

However, the news moving forward does not look quite so optimistic as the number of landlords that expect to acquire more properties over the next 12 months has decreased from 25% to 27%. Meanwhile, the number looking to sell has risen from 8% to 9%.

In addition, landlords have also been steadily decreasing the percentage they are borrowing on each property. This could also reflect the lack of mortgage finance or the fall in property prices in certain regions.

The current average loan-to-value (LTV) stands at 46%, which is the lowest since Q2 2007 when the average was 60%.

Tim Hyatt, President of ARLA, has been commenting regarding the coming year: “Rental growth will remain robust across all sectors, albeit at a more sustainable level of around 4% to 5% for this year. This will come about in part because of the continued inactivity in the sales market but nothing like the growth we have seen for the past two years.”