According to a report from German lender Handelsbanken, property investors are switching from residential to commercial assets, largely as a response to the government attempting to rebalance the power between landlords and tenants. The report found that 46% of investors expect to grow their commercial assets, compared to just 17% intending to extend their residential portfolio, with The Renters’ Rights Bill and upcoming Energy Performance Certificate rules being blamed on the shift. The particular points of concern related to the new EPC rules requiring all rental properties to be brought up to a C rating by 2030, and the ban on ‘no-fault’ Section 21 evictions, plus replacing fixed term tenancies with the periodic model, where tenancies automatically renew.

However investors responding to the Handelsbanken survey weren’t all negative, with over a third saying they felt more positive. The bank’s spokesperson Chris Teasdale said: “The results of this year’s report show an industry that still has plenty of optimism and potential, even in the face of uncertainty, challenge, and change. Whatever the wider economic backdrop, the good news is that this is still a sector with plenty of appetite for growth.”