UK landlord confidence hits new low
As you probably know by now, we’ve been conducting regular landlord confidence surveys over the past 18 months to see how a drastically changing market is affecting people.
On the face of it, with demand and rents at an all time high, landlord confidence should reflect that. But we know it’s not that simple and confidence is about more than what’s happening right now.
Here’s what we found.
Just 43% of UK landlords who took the survey told us they were confident in the market. That’s the lowest since we started these polls.
London doesn’t tell quite the same story though. As the graph below shows, the Capital has lagged behind the rest of the UK in terms of landlord confidence…until now. In fact, London’s landlords are, overall, more confident now than they were 18 months ago, which definitely isn’t the case across the UK as a whole.
When we started doing these surveys, the market was recovering from tenant demand dropping off a cliff. Then, in the latter half of 2021, demand started to climb and, as we’ve seen, didn’t stop until late into 2022.
However, with interest rates rising, as well as the general cost of materials and tradespeople (if you can find them), plus the continued threat of further government legislation for the rental market, landlords aren’t celebrating.
Despite a turnaround in demand, plenty of landlords are still planning to either downsize or leave the market altogether.
23% of UK landlords say they’re planning to reduce their portfolio in 2023, with only slightly fewer London landlords (21%) saying the same.
London and the UK are on the same path however, when it comes to people planning to leave the market altogether next year, with 18% of landlords in both saying they plan to quit.
That’s still almost one in five people saying they’ll leave the market - at the end of a year where rental supply dropped to a 9 year low in the UK (10 year in London).
Tenant demand can’t keep rising - neither can rents. Maybe 2023 is the year where the rental market settles into some sort of ‘new normal’, but it feels like there’s still a lot to play out.
As always, we’ll keep you updated with news on what’s going on as 2023 unfolds.
Image credit - Alexandre Debiève