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Shrinking private rental market in Newark

The shrinking private rental market in Newark has had weight added to it by some interesting information from Hampton Monthly Lettings Index as reported by Property Investor News.

They report:

The 1 April 2021 marked the five-year anniversary since the 3% stamp duty surcharge was introduced on second home purchases in Great Britain. This coupled with the tapering of mortgage interest tax relief on buy-to-lets (beginning in the 17/18 tax year), has meant that landlords have bought fewer homes and the private rental sector has shrunk, according to the April edition of the Hamptons Monthly Lettings Index. 

Between April 2016 and the end of March 2021 landlords purchased 700,100 homes across Great Britain. However, the research by Hamptons shows that without the tax changes, landlords would have bought an extra 249,800 or 36% more homes. 

Fewer landlord purchases have meant there were 4.91m privately rented homes in Great Britain in 20/21 accounting for 17.5% of households – 381,990 fewer than the sectors peak in 16/17.  Had these tax changes not been introduced the firm calculates that there would have been 5.16m rented homes in Great Britain today, making up 18.4% of households. 

Southern regions, where properties are more expensive, have been hit hardest by the tax changes. In London, the share of homes bought by landlords fell from a high of 20% in 2015 to 11% during Q1 2021. 

This shows that now only is the private rental market in Newark shrinking but also nationwide, as the Government seeks to milk landlords for every penny they can get. No doubt many landlords have tried to get back into the market this last year with the stamp duty holiday, but this has been off-set by inflated figures as demand outstrips supply.

As the Government consistently fails in achieving its objectives regarding house building, it is astonishing they haven’t tried to incentivise private landlords to make up the shortfall. As a result of their actions more properties are leaving the sector to do other things such as short term holiday rentals and houses of multiple occupation that are not suitable for families.

If you are a landlord looking to change the way you operate or looking to sell some or all of your portfolio then contact us for a fair price for a fast sale.