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Latest property news
Smaller landlords are disappearing – is this what the Government wanted all along?
Growth in the buy-to-let sector this year has dropped dramatically as more amateur, smaller portfolio landlords have stopped buying properties or decided to leave the market, a report has claimed. The Kent Reliance annual Buy To Let Britain survey, published in association with Legal & General, quizzed 865 landlords and shows that the recent mix of tax reform and tighter regulation has reduced growth in the number of privately rented houses to 2.2% this year, down from just over 8% in 2014. These recent reductions in tax allowances and extra Stamp Duty, coupled with a second round of stricter buy-to-let lending rules introduced by the Prudential Regulation Authority (PRA) this year, means the market now favours larger portfolio and institutional investors, the report claims. Limited companies And the landlords who have stuck with buy-to-let are now increasingly turning to limited company status to reduce their tax costs. Kent Reliance says 70% of all buy-to-let loans are now from companies rather than individuals. This, Kent Reliance Chief Executive Andy Golding (pictured, left) says, is having the effect many warned it would – to push up rents as tenant demand outstrips supply in some areas of the UK, in particular the East…
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Latest property news
Landlord confidence shrinks as government squeeze continues
The damage inflicted on the buy-to-let market by the government’s squeeze on landlord finances is laid bare by an in-depth report into the sector published today. Lender Kent Reliance says landlord confidence has shrunk alarmingly. Only 41% of those it canvassed say they have a positive outlook for their portfolios, down from 67% three years ago. The Buy To Let Britain report also says a quarter of landlords are finding it harder to get buy-to-let mortgages following the tighter lending rules introduced by the Prudential Regulation Authority. And faced with higher personal tax bills following the recent tax changes which restrict the amount of mortgage interest landlords can claim relief on, many are now moving their properties to limited company structures, the report says. Kent Reliance says 44% of all buy-to-let loan applications it received in the first three months of this year were from limited companies. And a quarter of landlords are considering moving their properties to the ownership of spouses in a bid to mitigate their tax liabilities. “A perfect storm of weakening house prices, higher taxes and lending restrictions have knocked investors’ confidence,” says Andy Golding, Chief Executive of Kent Reliance’s parent company OneSavings Bank (pictured, left).…
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