Buy-to-let landlord purchasing activity has slowed significantly over the past year, with the number of landlords acquiring properties dropping by approximately 85,000 transactions.
New analysis of data from The Mortgage Works reveals that only 6% of the UK’s estimated 2.84 million landlords purchased a property in the last 12 months — a notable decline from 9% in Q1 2024. This translates to 170,520 buy-to-let purchases in the past year, down from 255,780 the previous year.
Regionally, the North East remains the most active market for landlord purchases, although activity has decreased from 22% to 17% of the region’s estimated 67,000 landlords buying properties over the last year.
In terms of volume, the East of England led the country with 23,360 landlord purchases, followed by the East Midlands with 21,720, and the South East with 18,760 acquisitions. The South West and North West markets recorded 18,300 and 18,080 purchases respectively.
Other regions included the West Midlands with 16,160, London with 14,010, the North East at 11,390, and Yorkshire and the Humber with 10,860 purchases. Wales saw the lowest level of landlord buying, with just 2,180 transactions recorded.
The data reflects growing caution among landlords, likely influenced by ongoing market uncertainty and legislative changes such as the Renters’ Rights Bill.
Dwelly, which carried out the research, says the figures suggest that concerns around the incoming Renters’ Rights Bill are weighing heavily on landlord intentions to grow their portfolios.
With potential changes to tenancy rules, eviction processes and compliance requirements on the horizon, many are waiting to see the final form of the legislation before committing further capital. However, the firm believes that once the bill has passed and the dust has settled, many landlords will remain in the sector and resume investment activity, particularly in areas with strong rental yields and high tenant demand.
Sam Humphreys, head of M&A at Dwelly, commented: “An 85,000 drop in annual landlord purchases is a clear signal that confidence has been dented by regulatory uncertainty, higher borrowing costs and slower house price growth. But this is not a mass withdrawal from the market, landlords are simply taking stock and who can blame them with the Renters’ Rights Bill set to bring substantial changes to the sector.
“Despite this uncertainty, the fundamentals of the rental sector remain strong, and once the Renters’ Rights Bill is finalised we expect many will return to buying, particularly in those regions where rental properties continue to bring strong returns on investment.”
Read the orginal article: https://propertyindustryeye.com/buy-to-let-market-cools-over-renters-rights-bill-fears/
