Increasing regulation of the private rented sector, the pain of finding tradespeople to do property repairs and increasing fraud are pushing more landlords into the arms of letting agents, it has been revealed.
Uswitch.com canvassed some 2,000 landlords including those who manage their own properties and found that 63% were considering a switch to a lettings agency.
The most common reasons for this were dealing with regulation, the process of finding and moving in tenants and a fear of being ripped off by unscrupulous tenants or fraudsters, although the challenges of finding tradespeople to fix leaky toilets or sputtering boilers topped the list.
The people Uswitch talked to said repairs consumed almost a fifth of their spare time on average.
And almost a third of landlords said they wanted to use an agency because they had a stronger knowledge of the rental market.
Fraud is also a big driver of ‘switching’ for landlords with a quarter of the respondents citing it as a cause.
Uswitch says false information and fraud in applications is the leading reason potential tenants are rejected, with over a third of landlords having encountered it at some point.
“With both the Renters (Reform) Bill and higher interest rates on mortgages having a huge knock-on effect on the residential property investment market, some landlords may find the coming months more challenging than usual,” says the firm’s BTL mortgages expert Kellie Steed (pictured).
“While it can feel like selling up is the only option, there are other ways landlords can keep profits afloat during the cost-of-living crisis.
“Switching to a letting management company offers some attractive advantages, and gives landlords the scope to hold onto their investment.
“Many offer increasingly alluring packages for landlords in return for around 10-20% of profits”
“Remortgaging a property can also save landlords money, as any equity held in the property will give them access to cheaper rates.”