Three quarters of landlords believe the private rented sector has got worse recently and half are planning to quit, a new report has found.

The survey by Total Property of some 3,500 landlords, tenants and agents reveals a sector under strain as Labour’s renting reforms and EPC changes loom, not to mention higher mortgage costs and increased regulation.

Among the tenants who were surveyed, nearly 90% said rising rents and affordability are a critical issue, while three quarters of agents said they are worried over compliance with the huge number of new rules and regulations coming their way within the Renters’ Rights Bill.

The survey also reveals that investment in the sector is waning, with just 3% of landlords saying they had joined during the past year.

When landlords were asked why they are quitting, the biggest reasons given were the end of Section 21, the Renters’ Rights Bill, compliance burdens, rising costs and tax changes.

Some 70% of landlords own between one and five properties, making them vulnerable to increasing costs and taxation but nevertheless 58% have already made energy efficiency upgrades, driven by growing tenant demand for sustainable housing and regulatory requirements.

Reshaping

“The private rented sector is undergoing one of the most significant periods of change we’ve seen in decades,” says Total Property’s CEO, Eddie Hooker (pictured).

“Rising costs, increasing regulation, and shifting tenant expectations are reshaping the market, and this survey reveals just how deep these challenges run.

“With nearly half of landlords considering leaving the sector in the next five years or reducing the size of their portfolio, and tenants struggling with affordability, urgent action is needed.

“What’s particularly concerning is that the vast majority of landlords have been in the market for over a decade, while new investment has slowed to a trickle.

“The fact that so few new landlords are entering the sector is a clear indicator of where the market is heading.”