In our latest survey for Q1 we wanted to get an understanding of how landlords are responding to the changes in taxation policy announced by the Government in recent months.
It is reassuring that landlords are telling us that they have a good knowledge of the changes with more than three quarters (76%) of our landlord panel now saying they do have a good understanding, up from 62% in the previous quarter.
Nevertheless, we have seen a marked dip in landlord confidence with a clear majority of landlords planning to increase rents in order to compensate for their increase in costs. In addition it is clear that landlords are reconsidering their plans to increase the size of their rental portfolios going forwards.
For example, as might be expected, the higher rate of stamp duty on buy-to-let purchases has impacted landlords’ immediate buying intentions. Just 9% of our landlord panel indicated they intended to purchase a property in the next three months.
However, not investing in property acquisition doesn’t necessarily mean not investing at all. Our latest data shows a marked increase in the number of landlords seeking to increase spending on their current portfolios in terms of renovation and maintenance.
It is important though to look ahead and with tenant demand remaining strong, the PRS will continue to play a critical role in the wider UK housing market.