28th
Mar 2022
The majority of landlords are sticking with their portfolios despite inflation fears, according to research from a Buy To Let company creation and management platform.
Around 29 per cent of landlords are seriously considering of reducing their portfolios due to inflation fears, however 24 per cent in the survey stated they are actively planning to buy further properties.
Last week on March 18th the Bank of England increased its key interest rate from 0.5 per cent to 0.75 per cent due to Russia’s invasion of Ukraine, and predicts inflation to reach 8 per cent by the end of June, if not sooner.
Those who took part in the survey, 83 per cent are extremely concerned by the probablility of rising inflation curtailing their intention to invest in more UK rental housing stock, as inflation could negatively impact current rental yields.
A little over half – 52 per cent – predict inflation could increase their property management fees by as much as 50 per cent.
The biggest key areas which will push up property management costs for landlords include mortgage finance, insurance premiums and energy bills affected by inflation.
Many landlords are taking a rational approach to this.
Overall the majority of respondents said they will be keeping their portfolios with 69 per cent saying that they feel responsible to help their tenants deal with the rapidly increasing cost of living emergency; 37 per cent of these landlords believe the best option to help is to freeze rents for the time being.
Chief Exec of the platform Moubin Failzullah, says “Despite the unprecedentedly high levels of inflation we’re expecting to see, our survey data strikingly affirms the enduring appeal of property investment.
“While, like the rest of us, property investors aren’t immune to the impact of rising inflation, our research shows most UK landlords don’t want to pass that burden onto tenants, if they can help it.”
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