A data gathering exercise by the Government has highlighted new and sometimes surprising facts about the UK’s landlords and their rental bricks and mortar, including why a quarter are plannig to sell of properties over the next 12 months.
Completed by Ipsos on behalf of HM Revenue and Customs among 1,243 landlords, the survey gives the most up-to-date picture of the sector including how different landlords invest in property, how many use letting agents, where landlords own properties and attitudes to tax.
The most topical part of the research concerns landlords’ faith in the sector, with some 24% intending to sell off some of their properties over the next 12 months, and 33% expecting to do so over the next five years.
One reason for this is the increased taxation and red tape faced by landlords in recent years, and one anonymous landlords with three properties told researchers that: “Bringing in policies and laws, discouraging landlords, or demonising landlords for investing some money, and forcing them out of the market…it does nothing for the social conscience and economic state of this country”.
The box (see right) explains the main reasons why landlords are selling up.
* Three quarters of landlords use their rental property as a ‘supplementary income’ while for 19% it’s their only income.
* 93% of landlords own their properties personally rather than through a limited company or partnership. 55% own just one property.
* The average number owned in three.
* The highest concentrations of rented properties are in the South East (22%) and London (16%).
* Landlord portfolios are largest on average in Scotland and the North East.
* Two-thirds of landlords earn £20,000 or less in gross annual income and half earn less than £10,000.
1% earn £200,000 or more from their portfolios each year and 2% earn between £100,000 and £200,000.
* Most landlords who own properties through a limited company or partnership are usaully operating within the commercial rather than residential sector.
* 60% of landlords bought their property as an ‘investment’ while 40% are ‘accidental’ landlords who used to live in it.
* Half of landlords do their own tax returns while the other half use an accountant.
* Two thirds of use a letting agent to manage their property.
* Approximately 70% of all landlords say they continue to operate within the private rented sector because property offers long-term security and is a ‘physical asset’ and that short-term higher costs overall are offset by their property’s long-term profitability both in terms of rent and capital appreciation.
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