The number of “reluctant landlords” is on the increase as the amount of properties coming into the rental sector simply because they cannot be sold is threatening to flood the market.
ARLA (Association of Residential Letting Agents) say that during the third quarter of 2011, almost half (49%) of members surveyed reported a noticeable increase in the number of unplanned lettings as property owners are turning to the privately rented sector because they are unable to sell their home. In England, this trend was more noticeable in the North West and North East where respondents reported an increase in rental property coming onto the market because the home has been on the market for so long without being sold. Members in Scotland, Wales and Northern Ireland also reported an increase. The only exception throughout the UK is Central London where the increase was only 17%. ARLA believe that this means some homeowners are having no other option but to become a landlord for the first time, many of them reluctantly.
ARLA report that the most likely types of home to be brought to market by a reluctant landlord are detached and semi-detached houses, while least likely are studio flats. They also suggest enlisting a managing agent who will be able to find and vet tenants as well as managing the property. ARLA also urge any property owner who has no experience as a landlord to get a landlord property insurance quote before committing to any one company.
ARLA President, Tim Hyatt, said “Letting a property is an excellent way of generating consistent income from your property, if the correct approach is adopted by prospective landlords. However, letting is an unregulated industry and there can be pitfalls for both landlord and tenant, including loss of monies. While we are, of course, happy to see an increase in the number of landlords, it is vital that every landlord – reluctant or keen – seeks expert advice before embarking on a rental arrangement. In particular, we would advise anyone considering renting or letting a property, to consult a licensed ARLA member.”