Following on from yesterday’s figures that suggest that 10% of landlords choose to quit the buy-to-let sector each year, Shelter have furthered elaborated on the most common reasons why.
It appears that many buy-to-let investors are choosing to sell-up due to personal circumstances than with legislation changes.
Influences to sell
Policy alterations were found to be only a small influence on a landlords’ decision to sell, with issues such as age or enthusiasm proving a more important factor.
A blog on the Shelter website says: ‘We know from previous research that a large proportion of private landlords are older people and – in any given year – may want to retire from being a landlord. Thirty five per cent of current landlords are over the age of 65. We also know that a quarter of landlords only got into the business accidentally and may not be in it for the long-term.’
Further data from the report shows that 13% of landlords only started letting their accommodation, as they couldn’t sell originally. 12% say that they started to source tenants as they inherited the property.
Shelter also claims that policy changes, such as the phasing out of mortgage interest tax relief and interest rate rates, would not have a significant impact on whether landlords stay or leave the sector.
Concluding, the blog said: ‘The landlords interviewed showed a strong commitment to the private rented sector and are not likely to leave in a hurry…Falls in house prices, or reduced profits, are unlikely to make many sell up…Landlords appear, overall, to respond to changes in the economic or fiscal environment by changing the rate at which they purchase new properties, rather than sell existing stock.’
‘The link between moderate policy change and landlord exit is loose and not as important as changes in personal circumstances.’