Landlords selling up

One in eight homes for sale is an ex-rental  - Zoopla!!

A new analysis by Zoopla suggests and one in eight homes currently for sale were previously let out. The portal says this proportion - 12% - has broadly held steady over the last three years.

It says: “Tax changes introduced in 2016, higher mortgage rates and greater regulation of rented property have all led to more landlords selling. However, not all these homes leave the rented market. We find that 40% remain as rentals as they’re either bought by a new landlord or let out by the current landlord who decides not to sell.”

In its latest market snapshot Zoopla says the sales market continues to adjust to 4%-plus mortgage rates with increased market activity rather than faster house price growth. More sellers continue to list homes for sale, and more sales are being agreed. Buyers are also paying a greater proportion of the asking price as confidence improves.

House prices have been broadly flat over the last 12 months, but over the first half of 2024 they’ve been higher across the whole of the UK; they are on track to be up to an average 2% higher by the end 2024.

The supply of homes for sale continues to grow and is 16% higher than a year ago – the average estate agent has 33 homes for sale. More supply and choice is supporting sales growth and is also keeping price inflation in check.

And buyers are paying a greater proportion of the asking price (96.8%), which has recovered the most in London and the South East.

In London, it's not uncommon for properties that were previously rented out (ex-rental properties) to be put on the sales market. This happens all the time and for various reasons:

Investment Cycle: Investors may decide to sell properties after holding them for a certain period to realize gains or reinvest elsewhere.

Market Conditions: Changes in market conditions or rental yields might influence owners to switch from renting to selling.

Owner's Circumstances: Owners may need to sell due to personal circumstances such as relocation, financial needs, or changes in family situation.

Property Upgrades: Landlords may sell properties after renovating or improving them to increase their market value.

Regulatory Changes: Changes in regulations or taxes affecting the rental market might prompt owners to sell.

Given that landlords have had to contend with increasing regulation and tax hikes and in particular the introduction of Section 24  this has meant that more landlords have sold their buy to let properties then ever before.

Given the dynamic nature of the London property market, there is a constant turnover of properties, including ex-rental properties being listed for sale. This trend can vary over time based on economic conditions, rental market stability, and investor sentiment.