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A new survey has shown that around 40 per cent of the country’s landlords have reported a rise in demand from tenants in their local areas over the last three months but a significant number are still planning to sell as a result of the government’s proposed tax changes.

The survey from the National Landlords Association reveals that landlords in the eastern areas of England experienced the largest net growth when it came to tenant demand, seeing an increase of 48 per cent. The increase was followed closely by the situation amongst landlords in south western areas and in outer London.

The South West saw tenant demand grow by 41 per cent over the previous three months, whilst outer London landlords benefitted from an increase of 40 per cent during the same period.

According to the survey, landlords reporting a decrease in demand accounted for only six per cent of the total number questioned. It was landlords with properties in the North East of England who claimed to have experienced the biggest net decrease in terms of tenant demand, reporting a 15 per cent decline.

This was closely followed by landlords in Wales, who said they had experienced a 15 per cent decrease in tenant demand. This was equalled in Yorkshire, where landlords also reported a decline of 15 per cent, and was followed by landlords in the North West of England, where an 11 per cent decline was experienced.

Tenant demand in some areas could continue to rise amongst landlords choosing to continue to rent out properties however, as the chairman of the National Landlords Association is warning of the potential impact of tax changes.

NLA chairman Carolyn Uphill says that renters look set to suffer as landlords pull out of the market, driving up both competition for properties and prices for tenants.

She said the NLA’s research suggests that one in 20 landlords (five per cent) will sell their properties as a result of plans by the government to take away mortgage interest relief. This, she claims, could have an effect on around 600, 000 tenancies and cause stock to dwindle further.

Uphill suggests that the proposed changes would be phased in over a number of years, offering some landlords the chance to reconsider their financial situations, but says there will inevitably be those who find they have no choice but to sell their property or accept losses which are unsustainable in the long-term.