Despite Coronavirus vast majority of landlords still making a profit, says survey

A respectable 83% of landlords made a profit in the first quarter of 2020 – but their average rental yield dropped to an average of 5.3%, a new 10-year low. The Mortgage Works survey of 863 National Residential Landlords Association members found one in four landlords reporting falling tenant demand, the joint highest level ever […] ©1999 - Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® - Despite Coronavirus vast majority of landlords still making a profit, says survey | LandlordZONE.

Despite Coronavirus vast majority of landlords still making a profit, says survey

A respectable 83% of landlords made a profit in the first quarter of 2020 – but their average rental yield dropped to an average of 5.3%, a new 10-year low.

The Mortgage Works survey of 863 National Residential Landlords Association members found one in four landlords reporting falling tenant demand, the joint highest level ever recorded. Still reeling from the coronavirus crisis, it also showed that confidence in rental yields and the private rental sector has fallen sharply – to their lowest levels in the study’s 14-year history.

Landlords owe an average of £519,000 across 5.4 buy-to-let loans and make £7,922 gross rental income from each property. However, 38% suffered rental arrears in the last 12 months, while 34% experienced a void period in the last three months – evidently a result of the pandemic.

London has been one of the most hard-hit regions by Covid-19. However, 82% of landlords in the capital are still turning a profit and pocketing gross rental income of £14,026. Central and outer London were the only areas where more than a third of landlords ran their operations as their main income.

Void periods

According to the study, landlords in the North East are more confident about the sector and financial market than the typical landlord, however confidence in their own lettings business is the lowest of all regions at 15%. This is underpinned by the North East having an above average level of void periods and the highest incidence of rental arrears.

Meanwhile, those in the North West achieve the highest rental yield (6.3%), with perceived tenant demand also the highest of all regions (23%). Despite this strong performance, the region has seen the highest selling activity at 16% and a higher incidence of arrears and void periods, both of which are 12% above average.

Read more about the effect of Coronavirus on the rental market.

©1999 - Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® - Despite Coronavirus vast majority of landlords still making a profit, says survey | LandlordZONE.

Source : Landlord Zone More   

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Will Ministers resist calls for mandatory registration of short-lets landlords?

The Government is set to make an announcement on short-lets regulations – just as the sector prepares to re-open its doors after the lockdown. MPs are studying a new House of Commons Library briefing document discussing calls for greater regulation and will soon scrutinise a ‘white paper’ of recommendations from Airbnb when it publishes its […] ©1999 - Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® - Will Ministers resist calls for mandatory registration of short-lets landlords? | LandlordZONE.

Will Ministers resist calls for mandatory registration of short-lets landlords?

The Government is set to make an announcement on short-lets regulations – just as the sector prepares to re-open its doors after the lockdown.

MPs are studying a new House of Commons Library briefing document discussing calls for greater regulation and will soon scrutinise a ‘white paper’ of recommendations from Airbnb when it publishes its UK roadshow findings later this month.

The platform has talked to hosts, communities and politicians across the UK about its proposals for a simple statutory registration system for short-term rentals.

Automated lettings payment platform PayProp believes that the results of Airbnb’s consultations – as well as their planned white paper – could be crucial to the future of the industry. Group chief sales officer, Neil Cobbold, says: “Implemented effectively, a short-term lets registration system could help the sector to professionalise without introducing too much red tape.”

He adds that reports of the 90-day rule in London being flouted regularly, means its effectiveness needs to be reviewed. “What’s more, as the popularity of short-term lets grows in other cities across the country, similar limits may need to be considered elsewhere,” Cobbold says.

The Commons document highlights a lack of taxation compliance by short-term landlords, the impact on local housing markets, and health and safety issues. However, the Government has no plans to ban the use of residential property for short-term lets and has been reluctant to pass further legislation.

The document also points to Office of National Statistics which estimates that 20% of adults used sites or apps such as Airbnb last year. It reports: “In 2017, Airbnb altered its booking system to automatically limit entire home listings in London to 90 nights per calendar year. However, there are various ways for short-term accommodation providers to circumvent these automatic restrictions.”

©1999 - Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® - Will Ministers resist calls for mandatory registration of short-lets landlords? | LandlordZONE.

Source : Landlord Zone More   

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