Generational split revealed in landlord selling plans

A generational split in landlords’ selling ambitions has been revealed in a new survey from property management platform August.

August’s survey of 276 landlords found that the majority under 45 plan to grow while most older landlords are preparing to sell.

The research found 75% of landlords aged under 35 plan to increase their portfolio sizes, with 37% of those aged between 35 and 44 feeling this way.

Conversely, 31% of landlords aged 55 to 64 plan to sell some of their properties while 19% of those aged over 65 plan to sell all of their properties.

This aligns heavily with landlords’ confidence levels.

The survey asked landlords to rate their confidence in being a landlord in the UK over the next five years on a scale of 0 to 10.

The average was 7.1, with 63% scoring 7 or above and 14% scoring 4 or below. But the average hides a sharp split. Landlords aged 35 to 44 scored 7.9. Landlords aged 65 or over scored 4.7, the lowest of any group by a wide margin.

Tax is the most cited influence on landlords’ plans (40%), ahead of mortgage costs (31%), legislation (29%) and rental demand (27%).

Among those planning to sell or reduce, legislation (41%) and tax (40%) lead. Among those planning to grow, rental demand (32%), house price expectations (32%) and, notably, tax (30%) are the main drivers, suggesting that for some landlords tax is a reason to restructure and expand rather than retreat.

Asked for their single biggest worry over the next twelve months, 26% chose further legislation, 19% void periods, 19% mortgage rates and 13% tax. More than half of the over-65s (55%) named legislation, while the 35 to 44s were most worried about mortgage rates (35%).

“Tax is the factor landlords cite most, but it doesn’t push them all the same way,” said Richard Samuel, CEO at August.

“For landlords who are selling, it’s one more reason to go.

“For three in ten of those planning to grow, it’s part of the reason they’re expanding, often by changing how they hold their property.

“Last week’s Budget raised tax on rental income again, so that split is likely to widen, and knowing your numbers matters more than ever.”