26^th Jul 2019

A trade association sent out a warning to the Prime Minister in waiting, that if there is any more legislation or punitive measures 'foisted' onto landlords, then he should expect to face an even further exacerbated housing crisis.

The association says the government must rethink its plans for the private rented sector, as the UK housing crisis will be compounded as it is “a racing certainty” that landlords will be quitting the market. The proposals for a national landlord licensing scheme and the scrapping of the Section 21 notice will trigger landlords' exits.

Its latest research claims the vast majority of landlords - 86% - have stated they will seriously consider it “very likely” or “likely” to leave the market, if the government makes it any harder and longer to evict tenants.

The association's views are firmly substantiated by the association's previous research which found that many landlords are pessimistic about their future within the PRS.

Four years ago 65% of landlords rated their business as “very good” or “good” and by 2019 this has fallen to just 37%.

The research also found that 46% of landlords became BTL investors for their pension pot or to provide additional income to a pension.

Many landlords may have to sell their BTL properties to adequately fund their pensionable years, as 51% of landlords who became BTL investors as a form of pension, have already retired or intend to do so shortly, which could see a reduction in private renting stock.

A spokesperson for the association, said: “Many landlords are telling us that the latest changes to the regulations affecting the private rented sector are the last straw.

“These are not the greedy or unscrupulous people that many would have you believe. They became landlords in order to fund their retirement, but they are being backed into a corner because the government’s plans to change the regulations- such as the proposal to abolish Section 21 of the Housing Act - is making it harder and harder for them to generate sufficient income.”

“If they are left with no option but to sell their property and exit the private rented sector in order to fund their retirement, then given how many landlords are retired or approaching retirement, the chances are that there will be a sudden and significant shrinkage in the size of the private rented sector. If that happened, it is a racing certainty that the current housing crisis would get worse.”


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