Rise of accidental landlord adds 80,000 homes to rental market

THE rise of the “accidental landlord” means one in 12 new homes for rent has previously failed to sell.

The growing trend added an estimated 80,000 homes to Britain’s rental market in 2017, according to analysis from a lettings network.

Countrywide said around one in 12 homes (8.2 per cent) that came on to the rental market in 2017 had been up for sale within the previous six months – equating to around 80,000 properties across Britain.

It made the projections for Britain as a whole based on its own data.

Countrywide said it is the third year in a row that the proportion of accidental landlord properties has increased – although it remains well below a previous peak in 2010, when 11.2 per cent of homes that came on to the rental market had previously been up for sale.

London was identified as having the largest concentration of accidental landlords.

In 2017, 12.5 per cent of homes coming on to the rental market in London had previously been up for sale – the highest figure since Countrywide’s records began in 2007, surpassing the previous 12.1 per cent peak in 2010. Elsewhere in Britain, would-be housesellers are far less likely to put their home up for rent. Just 5.6 per cent of new rental homes in Scotland had been up for sale.

Johnny Morris, the research director at Countrywide, said: “While most landlords are in the business by choice, the last three years have seen an increase in the numbers letting out a property they had previously tried to sell.

“With mortgage rates remaining low, these discretional sellers can afford to let their home while they wait and see what the future holds for the sales market.”

Countrywide said that, compared with traditional landlords, accidental landlords tend to stay in the rental sector for a much shorter period of time.

While the average investor owns their rental property for 17 years, the typical accidental landlord rents out their home for an average of just 15 months. Nearly nine in 10 accidental landlords (89 per cent) put their property back up for sale after the first tenant moves out, rather than looking for a new tenant.

The annual rate of rental growth picked up in November, with the cost of a new let rising 1.2 per cent over the past 12 months.