Almost half of landlords have sold a property in the last year or plan to do so, according to the latest sobering industry survey.

Just under a third (30%) of those surveyed in the Goodlord & Vouch State of the Lettings Industry Report had either sold one of their rental properties or put one on the market in the past year while another 17% were considering reducing their portfolio in the next 12 months.

More than half of those landlords (56%) planning to downsize or quit blamed incoming legislation, such as the Renters’ Rights Bill, and particularly the abolition of Section 21. Another 52% said new rules around energy efficiency standards would be a reason for leaving the sector. Rising mortgage rates, increased arrears, and tax changes are also causing the landlord exodus.

More than half (58%) of letting agents reported a drop in the number of available properties, with 37% noting a “significant” decrease. The survey also highlighted the intensifying pressures being felt by tenants as they compete for properties; more than three-quarters of agents said they’d seen an increase in the number of tenants searching for properties.

Fierce competition

Despite fierce competition, overbidding doesn’t appear to be a common practice as only 12% of tenants reported paying more rent for their property than the amount for which it was advertised, with 82% paying the advertised price.

However, the results show that shrinking supply is causing rents to soar, with almost half of tenants surveyed now considering themselves to be in “rent poverty”. Among letting agents, sentiment is at the lowest level ever recorded by the yearly survey, with 54% feeling pessimistic about the PRS.

Goodlord CEO William Reeve says the whole sector is under intense pressure and the light at the end of the tunnel remains dim.

“Overall, the country needs more rental homes to alleviate the supply/demand imbalance, which in turn requires house building, streamlined regulations, and better landlord incentives,” he adds.