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February 2025
RENTERS’ RIGHTS BILL HEADS TO THE LORDS
All eyes will be on the House of Lords as the Renters’ Rights Bill is set to be debated by the members of the upper chamber on Tuesday, February 4.
A series of government amendments to change the Bill were passed at the reading in the House of Commons on January 14, which included preventing
landlords and letting agents from asking for more than one month’s rent in advance of a tenancy.
Despite pleas from some MPs, housing minister, Matthew Pennycook ruled out rent controls saying it “could harm both tenants as well as landlords” by
reducing rented housing supply.
An amendment which would have introduced rent caps during tenancies was also rejected.
Elsewhere, the Bill will introduce a ban on Section 21 ‘no fault’ evictions, EPC targets and end fixed term tenancies.
Tenants will be allowed to request a pet and can’t be discriminated against if they receive benefits or have children.
The private rental sector (PRS) will have to abide by a Decent Homes Standard and Awaab’s Law
and there will be new ombudsman service for PRS landlords.
Housing minister Matthew Pennycook said the Bill would tackle the “insecure and unjust PRS” and “clamp down on unscrupulous landlords”.
Sheldon Bosley Knight’s lettings director, Rebecca Dean said: “We know our landlords will be understandably nervous about what happens next so we hope the Lords make some amendments so it can be debated again in the House of Commons.
“However, whatever the outcome, we at Sheldon Bosley Knight will do all we can to help, guide and support our landlords through the next few months as the consequences are felt.
“The sector is robust and resilient, with much to recommend it so we would urge landlords not to panic.
“Please do get in touch if you would like any advice as we would be happy to help.”
We will be discussing the Bill in our podcast which will take place after the Lords’ debate.
Rents fall for the first time since before
the pandemic
An improvement in the availability of rental stock and fewer tenants looking to move could be contributors to the first drop in rents since before the pandemic.
Average advertised rents of properties outside the capital have dropped by 0.2% to £1,341 per calendar month (pcm) compared with the last quarter.
It is the first fall since 2019 and brings an end to consecutive months of record rents.
The figures, released by property portal Rightmove in January, show this equates to a drop of just £3 in newly advertised rents.
Rents are still 4.7% higher than this time last year, but this is the slowest rate of growth since 2021.
One of the drivers of slowing rent growth has been the gradual improvement in the available supply of rental properties across the country. The number of available rental properties is now 13% higher than at the same time last year.
Fewer prospective tenants are looking to move than at this time last year, with the number of enquirers down by 16%. Some tenants, particularly first time buyers, have also moved to the sales markets, helped by lower mortgage rates and higher average wages.
Other factors include tenants who are choosing to stay put rather than move due to costs and while there is evidence of some
landlords choosing to exit the market, there are also signs others are continuing to invest.
Rightmove says the average number of applications per rental property is still in double digits at 10, double the pre-pandemic average, so the market is still very busy historically.
Sheldon Bosley Knight associate director, Nik Kyriacou said: “A dip in rents is good news for tenants, as is the news there is a gradual improvement in the availability of rental stock. This needs to happen for the sector to be healthy.
“It is also testament to landlords’ resilience they are investing in the sector to enable tenants to have a roof over their heads, rather than exiting completely.”
Landlords show resilience by diversifying
Landlords shifted their focus towards higher-yielding property types in 2024.
Research from Shawbrook showed applications for semi-commercial and commercial property purchases made up a greater share of total activity. While overall application volumes remained steady, landlords demonstrated a clear appetite for diversification.
Semi-commercial purchase applications rose by 31% year-onyear, while commercial property purchases increased by 28%.
Shawbrook said this demonstrates landlords’ resilience and adaptability in a challenging market.
At the same time, refinancing trends revealed a cautious approach to managing existing portfolios.
Applications for refinancing without additional capital raising increased across all property types, while refinancing with capital raise applications declined.
Shawbrook said this suggests landlords are prioritising debt management in the current high interest rate environment, opting to secure fixed rates through product transfers.
Landlords delaying work to bring EPC ratings up
Over half of landlords with properties rated below Energy Performance Certificate (EPC) C rating are putting off works needed to bring them up to scratch.
A small number of landlords with properties rated below C are not planning to make any changes at all, even though they will continue to rent.
All rental properties must have an
EPC rating of at least a C by 2030 to meet the government’s deadline, or risk substantial fines.
The study of 1,300 landlords, by buyto-let lender Landbay, found 58% of those with properties currently rated below a C will wait until nearer 2030 to do the work, with only 18% saying they would do upgrades as soon as possible. Some, 6%, said they won’t make any changes at all even though
they intend to continue renting.
The survey also showed those landlords who had between 11 and 20 properties had the most rated between D to G at 36%. These were followed by landlords who had between four to 10 properties, at 27%.
Surprisingly, just over 5% of landlords didn’t know what their EPC rating was.
Landlord confidence improves despite fear of Renters Rights Bill
In good news for the private rental sector, confidence amongst buyto-let investors has increased yearon-year.
Research reveals despite the introduction of higher Capital Gains Tax (CGT) in the October Budget and the potential impact of the Renters’ Rights Bill (RRB) there is gently increasing optimism among landlords.
Pegasus Insight’s latest Landlord Trends report for Q4 2024 shows 37% of landlords feel ‘good’ or ‘very good’ about their prospects in Q4 2024 compared to 33% in Q4 2023.
Unsurprisingly, those who report making a ‘large profit’ are most
likely to feel upbeat (71%), with this falling to 33% for those making a ‘small’ profit and 8% for landlords who are either breaking even or loss making.
The study of 789 landlords also found average rental yields remain close to the 10-year high at 6.4%. Meanwhile, despite 73% of investors saying they increased rents in 2024, 82% were found to be letting at least one property at below market rate. Just over six in 10 (62%) said they planned to increase rents this year.
Elsewhere, three quarters of those surveyed (76%) believe the RRB will be negative for their lettings business, 43% significantly so.
Sheldon Bosley Knight’s senior lettings negotiator Katie Fitzgerald said: “This is very encouraging news. The Pegasus Insight report shows since mid-2023, there has been a general upward trend in the proportion of investors feeling optimistic and this is something to celebrate.
“There are undoubtedly tough times ahead, not least with the RRB which looks likely to go through this spring. However, landlords are resilient and with the right agent behind them I am sure they can weather the storm.
“If any of our landlords have any concerns please do get in touch. We are here to help.”
Changing regulations and taxes key concerns for landlords
Changing regulations and taxes are among the major causes of concern for landlords. They are also key reasons for investors thinking of leaving the private rental sector.
A report by the Deposit Protection Service found 47% of landlords are considering selling some or all of their portfolio. This is down 2% from the previous survey in May last year. Just under a quarter (24%) said they were considering leaving the market in the next two years.
Of the 1,258 landlords surveyed for The Private Rented Sector Review, nearly nine in 10 (89%) said they were influenced by changes or proposed changes to legislation or regulation.
Some 94% said proposed reforms to Section 21 evictions were influential, 91% said the Renters’ Rights Bill, while 91% pointed to
capital gains tax changes.
With the impact of legislation, rising maintenance and buy-tolet mortgage costs impacting the ability to make a profit, 76% of these landlords also said returns from their investment were a significant consideration.
Nearly two thirds (61%) bought all their properties specifically for use as rentals. Another 30% either inherited or originally bought the property as their main home.
Just over half (57%) said they own one or two properties with another 38% owning between three and 10.
In terms of rents, the report found the number of landlords who had raised rents in the last 12 months has slightly decreased. However, the number planning to put up rents in the next six months has increased.
Buy-to-let lending grows
Good news for the private rental sector is buy-to-let lending has seen an increase.
According to UK Finance’s latest insight report, in Q3 2024, there were 48,862 new buy-to-let loans advanced in the UK, worth £8.6 billion. This was up 6.5% by number (8.9% by value) compared with the same quarter in the previous year.
The value of buy-to-let loans issued
also increased – 8.9% – compared with the same period a year earlier, while average gross buy-to-let rental yield in Q3 2024 was 6.93%, compared with 6.53% in Q3 2023.
During this period, the average interest rate across all new buyto-let loans was 5.22%. This was 0.03% higher than in the previous quarter, but 0.09% lower than in the same quarter of 2023.
Key drivers behind this, named by 75% of respondents, were legislation costs and maintaining rental values in line with local markets.
Sheldon Bosley Knight’s lettings manager Josh Jones said: “It should be a major concern that nearly half of landlords in this survey are considering leaving the sector. Any exodus will hit tenants which is exactly the opposite of what the proposed legislation aims to do.
“I know the Renters’ Rights Bill is a significant issue and landlords are bracing themselves for choppy waters when it goes through.
“However, this is why it’s so important to have a good agent to call on. We can guide landlords through the finer details and offer informed advice and support.
“If you would like any help please give us a call.”
Sheldon Bosley Knight’s lettings director, Rebecca Dean said: “This is encouraging and shows there is still an appetite for investing in the private rental sector.
“Landlords continue to show their resilience despite legislation and tax changes and are open to diversifying and making the most of the situation.”
• Great investment opportunity
• Lease length - 107 years
• Current rent value of £615 pcm
• Tenants in situ
• Communal gardens and parking
• EPC - D Longford Bridge Court, Union Place
• No upward chain
• Long extended lease
• Walking distance to Jaguar Land Rover
• Great for first time buyer or investor
The Hawthorn apartments
The Hawthorn apartments
Sheldon Bosley Knight is delighted to offer an off-market, exclusive opportunity of either individual plots or multiple unit discounted packages from developer Taylor Wimpey.
Ranging from one-bed apartments at 525 sqft to executive five-bedroom detached houses at 1,986 sqft, there is plenty to suit your investment needs.
> Locations include Hatton, Warwick, Gaydon, Nuneaton and Kersley.
> House types range from two-bedroom semi – detached, three-bedroom detached, four-bedroom detached and executive five-bedroom detached houses.
> Three blocks of apartments including one-bedroom apartments at 525 sqft and two-bedroom apartments at 750 sqft.
> House styles include the Gosford, the Byford, the Beauford, the Rossdale and the Lavenham.
> Multiple unit discounted packages available.
> Whole blocks available as single purchase.
> Potential for great yields.
*Discounts and
For more information please contact Nik Kyriacou and the New Homes Team on 01789 333 466
Coach House Court, Loughborough
• No upward chain
• Conveniently located close to town centre
• Two-bedroom second floor apartment
• Single parking space with barrier access
• Potential rent value of £900 pcm
• Communial grounds
• EPC - B
• Two-bedroom retirement apartment
• Refurbished throughout
£145,000
• Potential rent value of £950 pcm
• Minimum age of 60
Bridgefoot Quay, Stratford-upon-Avon Gross yield of 7.6% £150,000 SOLD
• Highly sought-after town centre location
• Vacant possession
• EPC - C
• Two-bedroom, second floor apartment
• No upward chain
• Allocated parking space
• Easy reach of mainline rail to London Marylebone
• Current rental value of £950 pcm
• Tenants in situ
• EPC - C
• Two-bedroom, first floor apartment
• No upward chain
£150,000 SOLD
Court, Alcester Road Gross yield of 6.3% £180,000
• Walking distance to the town centre
• Allocated parking space
• Potential rental value of £900-£950 pcm
• Allocated parking space
• EPC - B
Brookfield
Rosemary Drive, Banbury
• Development with two, six-bedroom apartments, four, four-bedroom apartments and two, three-bedroom apartments
• Modern fitted kitchenettes and bathrooms
• Excellent location for Warwick and Coventry Universities
• Current rent value of £243,480 pa, potentially rising to £257,400 pa
• Tenants in situ
• EPC - B Current gross yield of 9.7% £2,500,000
PART OF | SHELDON BOSLEY KNIGHT
• Two-bedroom end terraced house
• No onward chain
• Highly sought-after location
• Close to excellent road links across the city •
• A charming and characterful terraced home
• Excellent central location
• Perfect for a first-time buyer or investor
• Kitchen with built in/fitted appliances
• Current rent value of £825 pcm
• No onward chain • EPC - D
Haven Lodge
> Development of 35 studio apartments
> Modern fitted kitchenettes and bathrooms
> Highly sought-after location
> Allocated parking spaces
> Current rent value of £269,285.10 pa
> Tenants in situ
> EPC - B
Gross yield of 8% £3,250,000
• Beautifully presented six bedroom property
• No onward chain
• £650-£675 pcm per room
• Great addition to portfolio
• EPC - C Kensington Road, Earlsdon, Coventry Potential yield of 9.6% £450,000
• Fantastic Earlsdon location
• Six en-suites
Milverton Crescent West, Leamington Spa
• Stunning town house
• Sought after location close to town centre
• Secure gated parking for two cars
• Three bedrooms and three bathrooms
• Current payable rent of £1,850.00 pcm
• Exceptional finish
• Rare opportunity for investment
• EPC - B
Gross yield of 4.4% £499,500
• Prominent mixed use property with return frontage
• Newly refurbished
• Prominent for passing traffic Class E Business and Commercial
• Estimated rent of £26,600 per annum
• 144.15m2 (1,550 sqft2)
• EPC - E
West Midlands Leicestershire Worcestershire
