The majority of private landlords in England only run their lettings businesses part-time and own just one rental property, according to new research.
The survey, by the Council of Mortgage Lenders (CML) along with specialist lender BDRC and the London School of Economics, updates the findings from a similar study in 2010.
Majority of Landlords are Part-Timers with Just One Property
Six years later, the survey reveals there is almost no change in the number of landlords whose main occupation is not managing their property portfolios.
Back in 2010, 92% of landlords were part-timers, rising to 95% today.
Similarly, the proportion of landlords operating as individuals, rather than limited companies, is virtually unchanged. Six years ago, 89% of landlords managed their portfolio as an individual or couple, dropping slightly to 87% now.
This decrease may be a result of new tax relief changes that are due to be introduced in April 2017. From this date, the amount of tax relief that landlords can offset against mortgage interest payments will be cut to the basic rate.
However, limited companies will be exempt from the changes, which has prompted a move to this type of business structure. Find out more about the mortgage interest tax relief changes here: /mortgage-interest-tax-relief-changes/
Additionally, the survey highlights a move towards larger property portfolios.
Although the majority of landlords still own just one property, the proportion has dropped significantly since 2010, from 78% to 63%.
At the same time, the amount of landlords managing two to four properties has grown from 17% to 30%.
However, most landlords (90%) earn less than half of their income from their rental properties, which is almost unchanged since 2010. Does this suggest that the buy-to-let sector is becoming less lucrative?
With many recent legal changes affecting landlords, such as the new Stamp Duty surcharge, landlords must consider whether investment in the private rental sector is a viable option.
However, the CML does point out that the 2016 survey was only conducted in England, while the 2010 study covered the whole of the UK.