Recent findings from the Hamptons Lettings Index reveal a reduction in landlord property sales across the United Kingdom, with one notable exception.

The proportion of homes sold by landlords has experienced a decline from 15.7% in 2022 to 14.0% in the current year. This translates to a projected total of 139,820 buy-to-let sales in 2023, marking a significant decrease of 53,000 compared to the previous year and 62,000 less than the peak observed in 2021. Such trends suggest a prevailing cautious stance among investors, possibly influenced by the current economic climate.

Interestingly, Scotland stands out as an exception to this trend, witnessing an increase in the rate of properties sold by landlords. This regional divergence is noteworthy, indicating variations within the broader British market.

Concurrently, the rental market demonstrates resilience and growth. The average rental rate across Great Britain has remained stable at 11.7% in October, with both London and Scotland leading this upward trajectory. This sustained rental growth reflects the ongoing demand in the housing market amidst the evolving landscape of landlord investments.

Aneisha Beveridge, Head of Research at Hamptons, observes, "There’s a strong argument that landlords have been impacted more significantly than others. However, despite these challenges, most landlords are persevering. Strong rental growth acts as a mitigating factor, but they are also leveraging their equity and cash reserves to navigate these circumstances."

Beveridge notes that the landlords opting to sell are typically among the 10%-20% of mortgaged investors facing losses when remortgaging at higher rates. These individuals are strategically selling a portion of their properties to alleviate mortgage debt on the remaining portfolio, rather than a complete divestment.

Moreover, Beveridge highlights a broader supply issue in the private rented sector, not solely driven by landlords selling properties but also due to a lack of appetite among investors to acquire new buy-to-lets in recent years. This reduced influx of new rental properties contributes to the ongoing rental growth. When considering broader inflationary pressures, it is anticipated that rents will rise by 25% by the end of 2026.