New research from Kent Reliance highlights how landlords are worth £15.9 billion to the British economy and are supporting thousands of jobs across property industry. Yet, with higher taxes and associated outlay for property investors meaning that landlords are forced to cut costs, the economy could suffer.
Citing the study, Smallbusiness.co.uk says that landlords’ contributions to the economy have more than doubled in the last decade, from £7.1 billion in 2007 to the current £15.9 billion per year.
The figures are broken down in to the following:
- landlords’ greatest outlay is £5.5 billion on property upkeep, maintenance, and servicing (including £4.7 billion on lettings agents’ fees);
- £2 billion is spent in service charges and ground rent;
- insurance costs £963 million;
- £904 million is spent on utilities;
- a further £1.1 billion is spent on other associated costs of letting a property.
While the £15.9 billion is great news for the economy, additional research says that many landlords are taking action to cut costs against the background of rising costs, and higher tax bills, landlords are taking action.
Over a third (36%) of landlords, surveyed by BDRC Continental on behalf of Kent Reliance, are already reducing or planning to reduce their spending, while one in five are looking to raise rents.
The knock on effect is the impact on the industries and jobs that depend on landlords for revenues. Total planned cuts across the private rented sector would reduce spending by more than £500 million each year.
Research from ARLA says tax changes are forcing landlords to quit with letting agents reporting an average of four landlords per branch selling up and quitting the buy to let sector in the past month.