PRS Purge?

A survey by the National Landlords Association released last week reveals that PRS landlords are intending to sell 380,000 properties (19% of stock) within the next 12 months in response to taxation changes. The significant majority of these are single units; either flats (45%) or terraced homes (33%). For those waiting to get on the ladder, this represents a significant new supply, which brings both opportunities to purchase and also downward pricing pressure in the event that a large number of sales are brought on stream at the same time. For those looking for a solution to the housing crisis, this is not it. In the short term shifting tenures is likely to create flux and churn in the rental market, whilst in the longer term, it will reduce the amount of stock available for rent. With house price to income ratios sitting above mortgage availability (particularly in the South East), the impact of making more stock available to those that have been able to accrue significant deposits is likely to exacerbate the wealth gap. It will, however, be interesting to see whether this results in a longer-term rebalancing of the ratio of owner-occupied to rented property, particularly as institutions step into the gap left by retail investors.