It probably comes as no surpirise but the data reveals that London has been identified as the most expensive region in Britain to be a landlord.
The average UK landlord spends £3,632 per year, which equates to 34% of average rental income; almost half of the cost of London.
While London emerged with the highest average costs at £6,535 per property, the Capital’s high rents mean that this equates to less than a third (32%) of landlords’ rental income, the lowest cost to rent proportion in the UK. Trailing behind with the second highest running costs is the South East, where landlords spend an average of £3,691, or 37% of rental income, followed closely behind by the East of England with average costs of £3,212, or 35%.
The North East of England has been identified as the cheapest region, where the average cost is £1,895 per property per year, or 34% of the amount that they receive in rent. The region with the second lowest average costs is Wales, with landlords spending an average £2,211. However, in an area with lower rents, costs equate to as much as 41% of a Welsh landlord’s rental income. The third cheapest region is the North West, where landlords spend £2,483, or 33% of rental income.
When looking at local authorities, landlords have the lowest running costs in Blaenau Gwent, Wales, where they average at £1,495, while the nineteen local authorities with the highest average costs are in London. Outside of London, South Bucks in the South East tops the list, with landlords spending an average £6,078 per property.
Landlords are faced with rising tax burdens following stamp duty changes introduced last year and mortgage tax relief changes which came into effect in April. In light of this, over a third of UK landlords surveyed will be looking to cut costs, targeting letting agent fees, property maintenance and mortgage costs. However, one in five are considering raising rents to recoup some of these costs from their tenants.
John Eastgate, Sales and Marketing Director of OneSavings Bank, comments: “With a fifth of UK households living in rented accommodation, landlords play a crucial role in supporting the housing market as they bridge the gap between housing supply and demand.
While taxes may seem to be a simple way to tackle the UK’s housing crisis, they will have a ripple effect, and will impact businesses who support the property industry as landlords apply cost cutting measures, or cause rents to rise as tenants cover the cost of rising taxes, or even both.
Another effect that will emerge is a rise in professionalisation of the sector as amateur and accidental landlords leave the market, leaving fewer, bigger landlords. But this alone will not solve the nation’s housing crisis.”
