Why thousands of landlords are exiting this year

Hi there,

This is Chubby Wallet. The newsletter that teaches you how to profit from property trends before they go mainstream..

Here's what’s in store..

• General market update

• Renters right bill set to become law

• 6 step formula to win at property auctions

This week’s UK property update is out, filled with insights on listings, sales, and economic trends. Let’s dive in and see what’s driving the market.

Listings

Chris Watkins (Property Industry Eye) delivers again. In his latest report, week 34 saw 29.1k new listings, 10.6% above the 9-year average.

Listings are now only 2.7% ahead of 2024 YTD and 7.2% above 2017-19. 

More homes are hitting the market than selling, so withdrawal rates are key to watch as this indicates weaker demand and potential market slowdown..

Price reductions

Price cuts hit 17.5k properties, with 14.1% of stock reduced—matching August, up from 12.1% last year, and 33% above the 5-year average of 10.6%.

That’s roughly 90-95k monthly reductions. With one in seven properties reduced, buyers have leverage »»»14%+ reductions point to a softer market.

Sales

Despite the holiday slowdown, 21.3k homes were sold subject to contract (SSTC), below the 2025 average of 26.2k but 6.1% up year-on-year and 13% above 2017-19.

Net sales reached 16.2k, up 5% from 2024 and 9.8% over 2017-19. With listings up just 2.7% from last year, 2025 feels smoother than 2024.

Stock levels

August ended with 763,178 homes on the market, up 5k from July and 47k above 2024’s 716k.

Pre-pandemic markets averaged around 660k per year; while seller’s markets drop below 600k.

With less than 1% growth from July, we might be nearing a peak in stock levels September’s post-holiday data, including a clearout of unsold stock, will clarify.

Price trends

July sales (subject to contract) prices hit £344.78/sqft, up 1.97% from July 2024 and 3.85% from 2022, but down 0.5% from June’s £346.45.

The market’s on track for a 2-2.5% annual rise, which is below inflation and Chris’s 3.75% forecast. August’s sales numbers drop next week.

Fall-through rates dropped to 24.1%, just below the 24.2% long-term average—nothing notable here.

Macro highlights

• Nationwide house price index: A 0.1% drop in August, with annual growth at 2.1% (down from 2.4%). Housing stock rose 9% over a decade to 25.4M homes, outpacing 7% population growth. Notably, 53% of owner-occupier homes have 2+ spare bedrooms; flats make up 42% of private rentals, 45% of social rentals.

• Bank of England Money and Credit: July net borrowing was £4.5bn, with 65.4k mortgage approvals—solid but not stellar. Consumer borrowing hit £1.6bn, and large businesses borrowed 8% more than last year.

• Purchasing Managers Index: This is a monthly economic indicator derived from surveys of purchasing managers in manufacturing and service sectors. Services climbed to 54.2 a one-year high. Construction dropped to 45.5 (an 8-month decline), and manufacturing hit 47.

Looking ahead

The market is stock-heavy, with plenty deals for sharp buyers/investors. September’s data will set the tone for the rest of the year.

The Renters' Rights Bill has passed its final Commons debate and is heading for Royal Assent, bringing the most significant changes to rental legislation in over 30 years.

With Housing Minister Matthew Pennycook rejecting almost all non-Government amendments, the Bill maintains its original tenant-focused approach.

Here's what landlords need to know about staying compliant in this evolving regulatory landscape.

Key changes

The legislation delivers on Labour's campaign promises with several major reforms:

• Section 21 abolition - No more "no fault" evictions

• Decent Homes Standard introduction across the private rental sector

• Rent increase limits with enhanced tenant protections

• End to bidding wars through new rental discrimination rules

• New ombudsman service for tenant-landlord disputes

• Public property database for transparency

• Assured Shorthold Tenancies phased out in favor of open-ended agreements

Expert insights on the renters reform bill

Nathan Emerson, CEO of Propertymark, describes this as:

Greg Tsuman, MD of Lettings at Martyn Gerrard Estate Agents says:

Shadow housing secretary James Cleverly warned that:

Immediate actions required

• Review your current tenancy agreements

• Open-ended tenancies become standard

• Prepare for 2-month tenant notice periods - This goes live immediately upon Royal Assent Audit property standards -

• Ensure compliance with incoming Decent Homes Standard 

• Update rent review processes -

• New limitations on increases will apply

Longer-term planning

• Build relationships with the new ombudsman service

• Prepare for property database registration

• Review insurance coverage

• Strengthen tenant vetting processes

Market opportunities

• Professional landlords gain competitive advantage

• Quality properties command premiums

• Long-term tenant relationships become more valuable

• PropTech solutions in demand - Digital tools for compliance management and tenant communication will see increased adoption

Managing risks

• Landlords should factor in:

• Higher compliance costs

• Potential rental income volatility

• Increased importance of comprehensive insurance coverage

• Need for stronger cash reserves given extended notice periods

Final thoughts

Demographic shifts continue favouring rental demand, with younger generations facing homeownership barriers.

However, supply issues may emerge if smaller landlords exit the market, potentially creating opportunities for professional operators…

6 step formula to win at property auctions

1. Remove Emotion : Only amateurs buy with their heart. You buy with numbers and spreadsheets. If numbers don't work, walk away

2. Gather Data: Look at condition, structural issues, renovation costs, planning permissions, title issues, restrictions. Use different spreadsheets for leasehold, freehold, and commercial properties.

3.  Calculate Maximum Bid: Buy for at least 25% below current market value. Odd Number Trick »»» most bid in round numbers (£260k). Set yours at £263k - often wins by beating their limit…

4. Stick to maximum bid: Stick to it absolutely. Trust your spreadsheet.

5. Arrange Financing: Standard mortgages impossible (28-day completion) Need 10% deposit on auction day

6. Find Private Investors: Do this only after completing the above steps and confirming you have a good deal.

That's it for this week folks. Each week we'll cover strategies, updates and insights to help you succeed in real estate. We love this stuff!

If you Have questions or just want to chat, We want to hear it.

See you next time in your inbox!

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