Landlords are being squeezed out of the private rented sector by an increasing number of hidden costs, it has been revealed.

Rental property-buying specialist, LandlordBuyer, claims that many smaller investors now reconsidering whether rental properties remain financially viable.

Alongside higher mortgage rates, landlords are also facing rising repair bills, insurance premiums, licensing charges and compliance costs, with uncertainty about future EPC requirements adding to the pressure.

The property buying company adds that many landlords are now struggling with the combined impact of ongoing expenses which go far beyond just higher mortgage repayments.

EPC standards

The company highlights Government estimates that suggest the average cost of upgrading a rental property to meet proposed minimum energy efficiency standards by 2030 could reach around £5,400 per property, while selective licensing schemes in some areas can add another £1,000.

At the same time, inflation has continued pushing up the cost of contractors, emergency repairs and maintenance work, while refinancing at higher rates and void periods are further damaging profitability.

Many landlords are finding that the overall cost of keeping a rental property has risen sharply over the last few years.”

Jason Harris-Cohen (pictured), Managing Director of LandlordBuyer, says: “Many landlords are finding that the overall cost of keeping a rental property has risen sharply over the last few years.

“It’s often the combination of maintenance, compliance, financing, and regulatory costs that creates the biggest pressure over time.”

As a result, LandlordBuyer reports it is seeing growing interest from landlords who are exploring ways to sell off their rental properties without requiring tenants to move out.