I was recently reading a report by the Home website which suggested that landlords are selling en-masse their buy-to-let investments due to increasing burdens on them in the buy-to-let market. Their findings suggest the number of new properties that came onto the market nationally (for sale) jumped by 11% across the UK as a result.
Those increasing burdens include new tax rules coming in over the next 3 to 4 years and the announcement that all self-managing landlords (i.e. landlords that don’t use a letting agent to look after their buy-to-let property) will soon need to register with a compulsory redress scheme to resolve tenant arguments and disputes; as Westminster wants to heighten standards in the Private Rented Sector.
Interestingly, a few weeks ago I was chatting with a self-managed landlord from Bloxwich, when I was out who didn’t realise the other recent legislations that have hit the Private Rented sector, including the ‘Right to Rent’ regulations which came in to operation last year. Landlords have to certify their tenants have the legal right to live in the UK. This includes checking and taking copies of their tenant’s passport or visa before the tenancy is signed. Of course, if you use a letting agent to manage your property, they will usually sort this for you (as they will with the redress scheme when that is implemented).
If you are a self-managed landlord though, the consequences are severe because if you let a property to a tenant who is living in the UK illegally, you will be fined up to £3,000. That same landlord contacted me last week, and I checked all his paperwork to ensure he was on the right side of the law going forward – and I offer the same to any landlord in the Walsall area if you want me to cast my eye over your buy to let matters (and at no cost – ok just bring in some chocolates for the Boss!)
But what of all these extra properties being dumped onto the market in Walsall? When I looked at the records the number of properties on the market in Walsall now, as opposed to a year ago, the numbers tell an interesting story …
Overall, Walsall does seem to be ‘Bucking The National Trend’, with the number of properties on the market not increasing but decreasing by a whopping 21.95% in the last year. Interestingly you can see from the figures that a huge dump hasn’t taken place in our local property market of Walsall with fewer properties on the available market than the same time last year! It was particularly interesting to see the number of detached properties decrease by 34%.
The whole property market has changed in the last 12 months, with the majority of the change in the number and type of properties for sale due to the owner-occupier market, not landlords (a subject I will write about soon in my Walsall Property Market blog in the coming weeks). You see, for the last ten years, each month there has always been a small number of Walsall landlords who have been releasing their monies from their Walsall buy to let properties – as is the nature of all investments!
Nationally, the number of rental properties coming on to the market to rent fell by 16% in Q4 2017 compared to Q4 2016 .. but that isn’t because there are 16% less rental properties to rent – it’s because tenants are staying in their rental properties longer meaning; less Walsall properties are coming on the market to be RE-LET.
Nevertheless, some Walsall landlords will want to release the equity held in their Walsall buy to let properties in 2018. All I suggest is that you speak with your letting agent first, as putting a rental property on the open market often spooks the tenants to hand in their notice days after you put it on the market (because they don’t like the uncertainty and also believe they will become homeless!). This means you have an empty property, costing you money with no rent coming in. However, some letting agents who specialise in portfolio management have a select list of landlords that will buy with tenants in-situ. If you have a portfolio in the Walsall area and are considering selling some or all of them – drop me a line as I might have a portfolio landlord for you (with the peace of mind that you won’t have any rental voids).
If you are keen to take things further, be it to start from scratch, or do something a bit more interesting with your current portfolio… start the conversation on email or phone for a chat. I’d love to meet you in person of course perhaps over a nice cuppa.
Phone: 01922 311016