350,000 Scottish tenants could be at risk of losing their homes as 90 percent of landlords say they will sell their rental properties if rising costs lead to them making a loss, according to a letting agent.
Scottish landlords surveyed by online letting agent MakeUrMove also stated they would consider selling if further legislation changed to favour the tenant or if the new tenancy agreements introduced last year make their property too difficult to manage.
2017 saw big changes to the Scottish property market with the introduction of Private Residential Tenancy for all new residential lets, changing the relationship between landlords and their tenants. Scottish landlords were also impacted by changes to the UK tax regime relating to landlords’ abilities to offset mortgage payments against rental income, and the repercussions are being felt this year.
As the clear majority of Scottish landlords indicated they would sell their property if it was making a loss, the biggest fear for property owners is this could lead to a housing crash, with the market flooded with ex-rental property for sale, damaging the house prices for homeowners. And this is a trend seen throughout the UK.
MakeUrMove managing director, Alexandra Morris, commented: “The changes have had a massive impact on many landlords – forcing them to really look at the figures and leading many to wonder if it’s even financially worthwhile keeping their rental properties.”
According to MakeUrMove’s research, 34 percent of landlords in Scotland purchased a property as an investment. When the last financial crisis hit, the housing market crashed, and many landlords found themselves in negative equity and their investments quickly turned into expensive burdens.
Scotland has a buoyant rental market with 32 percent of landlords owning more than one rental property and 59 percent having owned their properties for more than four years.
Morris continued: “It’s great that we have landlords in Scotland who see owning and renting property as an investment. The Scottish Government needs to carefully consider how they legislate to regulate the vital role landlords play in the housing market because at present, 56 per cent feel like they have limited to no value in the Government’s eyes. This apathy could lead to bigger problems for the economy if not addressed.”
For more information visit: www.makeurmove.co.uk
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