Buy-to-let rental value drops £22bn in first quarter

The value of the private rented sector fell by £22bn in the first quarter of this year, as buy-to-let expansion halts amid weakening house prices. Some 5.4m properties in the sector equated to an average value of £238,638, according to the ninth edition of the Buy to Let Britain report, published by Kent Reliance for Intermediaries. The number of properties rose by 3,000 against the previous quarter, but prices were down from an average of £242,894. Annual growth of the private rented sector also hit a 10-year low last year, rising by just 0.5% in 2018. An uptick of £6.1bn in 2018 saw the sector hit £1.3tn. This is the lowest annual growth since 2009. London saw the largest annual falls, dropping by £4.9bn. The largest increases were seen in the West Midlands, up by £3.7bn, and in the South West, which rose by £3.3bn. The sector is currently worth £502bn in the capital, making up 39% of the total market. This was followed by the South East (£193bn) and East of England (£118bn). Andy Golding, chief executive of OneSavings Bank, which trades under the Kent Reliance for Intermediaries and InterBay Commercial brands in buy-to-let, said: “Landlords have rolled with the punches as best they can but there is no escaping that growth is subdued in the private rented sector following four years of government intervention. “Brexit uncertainty has only compounded this issue, having the obvious knock-on effect on landlords’ confidence.” Golding pointed to a recent increase in yields as a positive sign for investors and noted the rise of professional landlords, adding: “It’s clear the private rented sector now holds less appeal for amateurs.” To send feedback, e-mail emma.rosser@egi.co.uk or tweet @EmmaARosser or @estatesgazette