New regulations are prompting a ‘changing of the guard’ within the PRS according to Together, with the lender finding more landlords are planning to exit as a result.
In a survey of 1,000 BTL landlords, Together found that regulations such as the upcoming Renters Reform Bill are piling more financial pressure on landlords with smaller portfolios.
As such, 11% of landlords are planning to exit the market altogether with 12% at least set to offload properties this year.
When asked what the main drivers were for exiting or downscaling their BTL ambitions, 14% of landlords pointed to a greater Capital Gains Tax burden while 12% pointed to rising interest rates.
Elsewhere, 8% cited headaches from the Renters Reform Bill as the main reason.
Despite this, more landlords - 29% - are planning to expand or diversify their portfolios instead of scaling back or exiting.
Further reform of BTL policy and intervention by the Labour government was identified as a challenge over the next 12 months by 16% of landlords.
Additionally, 15% identified stamp duty increases as their biggest upcoming challenge with the same percentage feeling the same for safety standards.
“There will likely be some smaller or amateur landlords who decide to sell off investments or exit completely, but in their position we are already seeing larger, professional landlords stepping in to seize diversified opportunities,” said Ryan Etchells, CCO at Together.
“Until the final outcome of the Renters Reform Bill is known, there may be a bit more volatility as landlords assess the cost impact to them and their property plans this year.
“But, on the whole it’s a changing of the guard rather than a mass exodus.”
