Budget fallout: Most landlords planning rent rises

Most landlords are planning to raise rents when they are next able to do so as a result of the Budget, according to new research from Pegasus Insight.

A snap poll of 168 members of the National Residential Landlords Association (NRLA) found 73% expected changes to rental income tax would lead to higher rents.

Alongside the expected pressure on rents, 52% said they planned to sell property over the next 12 months in response to the tax changes.

Many are also planning to refinance their properties within the next 12 months.

Further analysis of other recent Pegasus data, by Foundation, found that 38% of all landlords surveyed in Pegasus’s latest trends update intend to remortgage or product transfer.

Those planning to refinance expect to do so across an average of 2.9 mortgages.

This was based on a wider sample of 584 landlords surveyed in October.

The report also found that 85% of landlords continue to make a profit from their lettings activity, with profitability remaining broadly stable over the past six years.

“For proactive advisers, the level of refinancing anticipated over the coming year represents a valuable opportunity to have those conversations early and to add value by understanding what clients are looking to achieve,” said Grant Hendry, director of sales at Foundation (pictured above).

“Rather than an exit, this is increasingly focused on adjusting their strategy, restructuring their portfolio and expanding their reach.

“The right funding remains absolutely crucial, particularly for larger portfolio landlords and those operating through limited companies, whose borrowing requirements can be more complex and may not always fit standard high street criteria.”