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With mortgage rates rising, Superscript carried out two surveys of UK residential landlords to find out how they're reacting.
What we found
71% of residential landlords who responded had a mortgage on at least one of their rental properties and one in five admitted that interest rates were one of their three biggest concerns as a landlord.
This, combined with the Telegraph’s report that half a million landlords are already facing rent arrears due to a combination of the cost-of-living crisis and the collapse of housing support for tenants, paints a challenging picture.
Rents are increasing out of necessity...
- 50% of landlords surveyed had already increased rents on their properties following interest rate rises earlier this year.
- 70% of these landlords said that they had taken this decision because it was the only way they could afford rising mortgage rates.
... But landlords are working with tenants
40% of landlords surveyed said that they hadn’t put up their rents – but would do so if interest rates continued to rise. In fact, recent research by Shawbrook Bank suggests that one in twelve tenants have already had their rent reduced.
This aligns with our finding that despite financial pressures and unpaid rent being one of landlords’ biggest fears, over 70% of those surveyed said that they would consider either freezing or reducing rent for tenants struggling with the cost of living.
However, 50% of landlords surveyed said that they’d seriously consider selling their rental properties if interest rates were to continue rising.
The first survey was conducted on a representative sample of 500 UK residential landlords by consumer research provider Attest on behalf of Superscript on 19 August 2022.
The second survey was conducted on a representative sample of 600 UK residential landlords by consumer research provider Attest on behalf of Superscript on 30 September 2022.