Research commissioned by the site to coincide with Gumtree’s Q1 2009 Rental Index found almost a third of homeowners (29%) now rent out property to tenants, a massive 57% of whom have only done so in the past two years.
This means UK properties are being managed increasingly by individuals who are worryingly unaware of the processes involved in being a landlord. For instance one in two Landlords surveyed had failed to draw up a legal contract for their tenants and only 42% had taken out home insurance.
Gumtree’s Q1 Rental Index figures show this surge in supply has resulted in a 2.2% average decline in rents across the UK, with a 3.6% dip in London, and a massive 6% plunge in Oxford.
Manchester (2.9%), Belfast (2.9%) and Brighton (2.7%) experienced dips just short of 3%, with Birmingham and Stockport faring slightly better, dropping 1.5% and 1% since November 2008. This sees rental prices finally catching up with the property sales market, with yields reverting back to 2007 levels.
Three to four bedroom properties recorded the sharpest fall, suggesting renters were choosing to downsize from houses to flats to save money. London’s more prestigious boroughs including Kensington & Chelsea and Islington took the most rapid and forceful hit.
Behind Oxford, the biggest casualties were Glasgow, Nottingham and Leicester where it is widely known there was rapid growth in the buy-to-let market over the last few years.
TV property expert Sarah Beeny said: "In the past two years more and more people in the UK are becoming landlords, whether it’s because of recent redundancies, expanding families or an inability to sell at a level people wish to.
"Current unbelievably low interest rates also means people are not having to sell and can afford to move and rent out their current property to cover their mortgage instead. The property sales market is not going to ‘bounce back’ as some imagine anytime soon and whilst interest rates stay low even though the rental market is slower than it has been, I suspect we will see more and more ‘unplandlords’ emerge."
These new property professionals admit to serious gaps in their knowledge, posing risks to both themselves and their tenants. These include:
* 46% who did not get a legally required gas safety certificate;
* Less than half (47%) installed a smoke alarm;
* Less than half requested references from tenants (46%);
* Nearly two-thirds (64%) failed to draft an inventory
In response to these findings, Gumtree has produced an online guide with Sarah Beeny to help "unplandlords" settle into the job. To help those who have found themselves in this situation the guide covers everything from what is required to prepare homes for tenants, what price they should be charging and how to find suitable tenants.
Beeny said: "We are clearly still a nation of homeowners but many are now in the situation where they have chosen to also take on this new role. There is an influx of new landlords into the market unprepared for what comes with it. The law is more on the tenants’ side so it is really important landlords are well prepared so the process runs smoothly for them. Gumtree’s guide will give these people the knowledge and confidence to manage their properties more efficiently."
Landlords can download the Gumtree Guide to the Unplandlord now, and listen to advice from Sarah Beeny at www.gumtree.com/rentalindex
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