85% of landlords are planning to increase rents over the next year. That’s right, most landlords are feeling the pinch and are passing on the cost to tenants.

Higher Costs, Higher Rents

The reason for this rent rise? A combination of higher mortgage rates and increased costs for managing properties. Many landlords are facing a double whammy as they struggle to keep up with the cost of living, meaning they have to increase rents to stay afloat.

How Much Will Rents Rise?

The survey by Landbay shows landlords are looking to increase rents by a significant amount:

• 36% of landlords will bump up rents by up to 5%.
• 37% plan to increase rents by between 6 and 10%.
• 8% are aiming for a massive increase of between 11 and 19%.

Landlords Are Under Pressure

Landbay’s Sales and Distribution Director, Rob Stanton, highlights the tough situation facing landlords. He states that the rise in rents isn’t just driven by increased demand for good quality rentals, but also by the need to cover the mounting costs of managing a property, especially with higher interest rates.

Property Management Costs Are Rising

The survey also reveals that property management costs are a major factor in the rise of rents. More than one in ten (16%) landlords are paying over 13% of their rental income just to manage their properties. With nearly a third (30%) paying 5% and a further 29% paying between 9 and 12%, it’s clear that these costs are a significant burden for landlords.

What Does This Mean for You?

For those looking to invest in buy-to-let properties, it’s important to factor in these increasing costs and understand the potential for rent increases. Talk to your mortgage broker to explore your options and see how you can manage these rising costs.