Seventy per cent of landlords are anticipating there will be further Government intervention in the private rental and buy-to-let (BTL) sectors during 2020, new research from Foundation Home Loans has revealed.

The intermediary-only lender suggested that of the landlords anticipating further Government action, 73% indicated it was either ‘quite’ or ‘very’ likely this would mean the introduction of minimum tenancy terms – while the same number thought action was likely in the HMO and multi-unit block sector.

Furthermore, 72% of landlords thought individual licensing for all landlords and their properties was likely, while 38% predicted a rental cap for private rental properties being introduced.

Foundation’s research, with the results based on 791 online interviews conducted in January, also quizzed landlords on how supportive of a rental cap they were – with 77% suggesting they were not in favour, 12% indicating they may be in favour, and 2% definitely supporting such a measure. The other 9% indicated they didn’t know.

Foundation director of marketing, Jeff Knight, commented: “While many landlords look like they’re taking a ‘wait and see’ approach to this Government, and any anticipated intervention in the PRS or BTL market, it’s also noticeable that many believe the status quo is unlikely to hold and there will be action of some kind.

“Interestingly, landlords appear resigned to the introduction of minimum tenancy terms, further action with regards to HMOs and MUBs and individual licensing.

“While 38% think a rental cap might be likely, there is very little support for such a measure being introduced, and it will result in landlords having to take action around the rents they charge and whether they can hold onto all their properties.”

When asked what action they would take should any cap on rents be introduced in the PRS, 35% of landlords suggested they would immediately increase all rents to the maximum rent allowable.

Another 33% indicated they would consider selling some of their portfolio, 20% didn’t know, while 19% said they would either look at leaving the PRS, or other assets for their investment. The other 10% said they would do nothing.

“There is definitely a degree of uncertainty around what might be coming next, and I suspect many landlords are waiting for this month’s Budget before they make up their minds more fully on whether this is a Government which will be more ‘friendly’ to landlords,” Knight added.

“Of those who think there will be intervention, 32% think stamp duty for landlords is just as likely to go up from its 3% extra charge level, as opposed to the 7% who think a cut is likely.

“In that sense, landlords appear to be bracing themselves for a Budget which may not be in their favour, rather than one which seeks to roll-back on the measures which have undoubtedly impacted on their profitability over the last few years.”

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