The Bank of England (BoE) recently released a report that found that smaller portfolio landlords are exiting the private rental sector. This is a significant development in the UK housing market, as it has implications for both landlords and tenants.
The BoE report found that the number of smaller portfolio landlords, those with four or fewer properties, has decreased by 8% since 2016. This is in contrast to the larger portfolio landlords, those with five or more properties, who have seen an increase of 5%. This suggests that the smaller landlords are feeling the squeeze of rising costs, such as taxes and regulations, and are leaving the sector.
The report also found that the number of tenants in the private rental sector has increased by 5% since 2016. This suggests that there is still demand for rental properties, but that it is being met by larger portfolio landlords. This could lead to higher rents, as larger landlords are more likely to charge higher rents than smaller landlords.
The BoE report also found that the number of new-builds in the private rental sector has decreased by 8% since 2016. This could be due to a lack of investment from smaller portfolio landlords, as they are less likely to invest in new-builds than larger portfolio landlords.
The implications of this report are significant for both landlords and tenants. For landlords, it suggests that they need to be aware of the costs associated with being a landlord and ensure that they are able to cover these costs. For tenants, it suggests that they may face higher rents as larger portfolio landlords enter the market.
Overall, the BoE report has highlighted an important trend in the UK housing market – the exit of smaller portfolio landlords from the private rental sector. This has implications for both landlords and tenants, and it is important for both parties to be aware of this trend and its potential effects.