A stuttering housing market has seen the return of the reluctant landlord – a phenomenon that emerged during the recession.At the height of the financial crisis, the rental market was flooded with homeowners that had wanted to sell their properties but faced losing money on their home, deciding instead to let them out.
At the peak of the problems, 94% of branches of the Association of Residential Letting Agents (ARLA) reported an increase of property coming onto the rental market because it could not be sold.
While the problem has since subsided, figures show that there was a marked increase in the number of reluctant landlords between July and September. Some 34% of ARLA member offices said there was an increase in the number of reluctant landlords putting their homes up for rent in the third quarter of the year.
The figure was significantly up on the 19% of branches that reported a rise in the second quarter of this year.There was variation across the UK in the number of agents reporting this trend, with 58 per cent of agents in the North East of England reporting an increase in reluctant landlords. This compares with just 15% in central London, where property prices have fared better, and, in some cases, continue to rise.
"The rise of the reluctant landlord seems to reflect wider market uncertainty and instability," Ian Potter, operations manager at ARLA, said.
"There is a dearth in available property either to rent or buy, yet people are holding back from selling, perhaps strategically, to secure the best price; or more likely because they simply can't find a suitable buyer."
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