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The Q4 2023 BTL Barometer
We evaluate the trends which are impacting your landlord clients and how their portfolios are currently shaping up.
In our Q4 2023 BTL barometer, brought to you in conjunction with the latest BVA BDRC Landlord Panel research, we evaluate the trends which are impacting your landlord clients and how their portfolios are currently shaping up.
This quarter, the average portfolio size is suggested to have further softened with the typical landlord now having 7.3 tenancies across an average of 6.8 properties. On a regional basis, landlords in central London reported the largest portfolios on average with 9.3 properties.
In terms of performance, average portfolio values and gross rental incomes have diminished this quarter. The typical portfolio has decreased to £1.35m, a fall of circa £212k vs Q3 figures and gross rental income is down to £62k (-£7k vs Q3).
The typical portfolio continues to be mostly divided by outright ownership and BTL mortgage borrowing with 46% of property portfolio ownership structures having a mortgage in place and 41% owning this outright. Fractional and commercially funded property continue to be less common forms of property ownership.
The structure of portfolio funding remained mostly stable, with the average number of BTL loans has decreasing by 1.7 loans since Q3’23. On average, leveraged landlords typically owe approx. £670k on their BTL borrowing, this has seen a considerable decrease of £134k since Q3. After a modest dip in Q3, the average amount of mortgage interest repaid over the last year has nudged back up to £28k (by approx. +£600) This increases up to £42,000 for portfolio landlords.
Focusing on property type within these portfolios, terrace houses remain the most commonly owned property type at 57% and landlords with larger portfolios are more likely to own terraced houses vs landlords with smaller portfolios. Individual flats and semi-detached houses followed in second and third place at 46% and 39% respectively.
Families with children continue to be the most common tenant type, coming in at 55%. This is closely followed by young couples (47%) and young singles (43%). Approximately 1 in 5 landlords let to LHA/UC claimants, down by 2% since Q3.
This data represents a strong reflection of how portfolios are stacking up in the current economic climate and we hope it can be of some use to you and your landlord clients.
FOR INTERMEDIARIES ONLY
