STAY CONNECTED!
    
newsletter-button

TODAY'S OTHER NEWS

MPL
Budget Preview: Landlords wary of further setbacks

Some 66% of landlords predict more rental sector turbulence in this week's Budget, according to research by property crowdfunding platform The House Crowd.

Over 70% of those surveyed by the website believe that the EU Mortgage Credit Directive as well as next month’s stamp duty surcharge will have a negative impact on their investments. 

On top of this, almost half of participants said they feel that the government is trying to squeeze small investors out of the market altogether. 

Over half of landlords indicated that they do, however, support tighter regulation from the Bank of England to clamp down on rogue landlords. 

Despite the uncertainty surrounding the market, almost 60% of those surveyed said they think buy-to-let will remain a strong investment option as the housing shortage continues.

Meanwhile, estate agency Chestertons says landlords can expect ‘little cheer’ when George Osborne delivers his latest update on Wednesday.

“We expect confirmation of further bad news from the Chancellor, particularly the announcement of the rules regarding the 3% surcharge on second homes and buy-to-let properties,” says Nick Barnes, Head of Research at Chestertons.

Barnes says he doesn’t expect Osborne to heed the warnings from the property industry and postpone the introduction of a stamp duty surcharge and the reduction of landlords’ buy-to-let mortgage interest tax relief.

Cory Askew, Executive Director at Chestertons, adds: “We would love to see the Chancellor throw some sort of bone to smaller buy-to-let landlords that are so vital to a vibrant private rented sector.”

He says that Chestertons would like to see increased emphasis placed on finding development land and lifting building barriers such as red tape and planning laws.

“Fiddling about with stamp duty or trying to influence investment behaviour is unlikely to achieve anything positive in this respect, more likely it will have the opposite to the intended effect,” he adds.

Jeremy Duncombe, Director of Legal & General’s Mortgage Club, says he remains hopeful that the government will refrain from further intervention in the buy-to-let market on Wednesday.

“The full impact of the announcements made in the Summer Budget and Autumn Statement are not yet clear, so further involvement at this stage could therefore derail the important market changes that the Chancellor was seeking,” he says.

Duncombe echoes Chestertons’ sentiment that housebuilding must be prioritised and suggests that tax incentives are introduced which encourage older borrowers to ‘rightsize’ and subsequently free up housing stock.

imgcollapse
sign up