Landlord confidence continued to slump at the end of last year, falling back to levels seen during the pandemic, says the National Residential Landlord Association (NRLA).

The association’s latest landlord confidence index reports on the situation in the final quarter of 2022, noting that the downward trend from the previous quarter continued.

The year ended with a fall in confidence from -27.6 to -33.2 amid threat of future legislation, the impact of tax relief changes and the impact of rising inflation.

While demand from tenants remains high, this is ‘not enough to persuade landlords to change their market outlook’, the NRLA says. The report notes the number of landlords ‘planning to sell’ is now at record highs (35%), while those ‘planning to buy’ is at record lows (12%).

Confidence has now been tumbling for four consecutive quarters and over that same period of time, 12% of landlords bought properties, 20% sold, 53% froze rents and 46% increased rents.

Closer analysis across the country revealed the biggest falls in confidence were reported in the South West, the North West and then the South East. Confidence grew slightly in the West Midlands and by the smallest fractions in Wales and outer London.

NRLA research manager Nick Clay comments: “For the first time since the LCI began, over 50% of landlords stated they had raised rents over the previous 12 months. At the same time, the proportion of landlords holding rents constant fell below 50% for the first time. The evidence presented in the LCI underlines the importance of ‘cost push’ factors driving rents – rather than ‘demand pull’ factors.”