buy-to-let
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Latest property news
Does buy-to-let still stack up?
Investors rushed to snap up homes before April’s buy-to-let tax changes - but what’s next? Marc Da Silva reports.
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Features
What’s next for buy-to-let?
"After an exciting and long ride, buy-to-let is now under attack from higher taxes, posher, new student homes and build-to-rent. So what’s next for buy-to-let?"
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Latest property news
The Budget 2016
A mixed bag for the residential property market, with no cuddly Easter rabbits coming out of Mr Osborne’s hat and a nasty shock for larger property investors.
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Latest property news
Chancellor’s assault on buy-to-let “is mystifying”
The Chancellor George Osborne has been slammed for his outright assault on buy-to-let investors following the introduction of a stamp duty surcharge last week, while also exempting landlords from fresh cuts to Capital Gains Tax, and planning further tax increases on property investors. The former Editor of The Times and the London Evening Standard, Simon Jenkins (left), questioned in his latest column for The Guardian columnist whether George Osborne was really a Tory. He also described Osborne’s “assault” on buy-to-let as “mystifying”. He wrote, “With the withering away of public housing, private renting is how evermore people live, especially in cities. They include the migratory rich, millennials, those unable to afford a house and those who are just very poor and cannot get a council tenancy. Between 2001 and 2011, private renting in London went from 17 per cent to 26 per cent of the housing market, and is continuing to rise.” Jenkins believes that encouraging the release of under-occupied space is the one sure answer to the housing shortage, and the most efficient way of doing this is by encouraging letting, especially in London. “Renting is the most efficient use of urban property. It keeps things flexible. It is…
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Latest property news
Investors hung out to dry as BoE gets tough
The Bank of England has announced plans to introduce more stringent checks on buy-to-let lenders amid concerns that the property investment market is moving into bubble territory. The Bank’s Prudential Regulation Authority said it was putting in place a “guardrail” to prevent banks from making risky loans, warning that 20 per cent of lenders were not carrying out the necessary checks. The main concern is that a bubble in the buy-to-let market could cause a wider housing market slowdown, which would be bad news for millions of people who have invested in property, as part of their retirement. More than 1.7 million properties have buy-to-let mortgages, which represented 17 per cent of loans used to acquire residential properties last year. “You might form expectations about what the necessary long-term saving to support your retirement will be, which can then (if house prices fall) be transformed quite suddenly in ways that, frankly, are unwelcome,” Bailey said. Andrew Bailey (left), who currently heads up the Prudential Regulation Authority, told the press that the Bank of England has “nothing against” buy-to-let landlords, but believes that new restrictions on mortgages for buy-to-let investors will help reduce the risk of “very volatile boom and bust…
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Latest property news
Bank of England to consult on buy-to-let ‘prudence’
The Bank of England has published a consultation paper (CP) which seeks views on its proposals which could result in strict limitations for buy-to-let mortgages. David Smith (left), the Residential Landlords Association’s Policy Director said, “The Bank needs to be careful that it does not over-react to the current surge in buy to let applications which are aiming to beat the tax increases coming in April. ‘These include a three percentage points extra levy on stamp duty and abolition of mortgage interest relief. It is likely that the impact of these will significantly reduce the demand for borrowing. “We would urge the Bank to tread carefully and avoid any premature moves that could stifle the supply of the 1 million rental properties the country desperately needs.” The consultation paper says: Underwriting standards for buy-to-let mortgage contracts – CP11/16 Background This consultation paper (CP) seeks views on a supervisory statement which sets out the Prudential Regulation Authority’s (PRA’s) proposals regarding its expectations of minimum standards that firms should meet when underwriting buy-to-let mortgage contracts. The proposals also include clarification regarding application of the small and medium enterprises (SME) supporting factor on buy-to-let mortgages. Summary of proposals The proposals seek to ensure…
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Associations & Bodies
Straight talking
Marc Da Silva asks the Managing Director of ARLA about the new three per cent SDLT surcharge for buy-to-let and second homes and tax relief change for landlords.
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Housing Market
Changes in housing tenure
The buy-to-let market is not a problem, it is a much needed solution, says Frank Webster, Vice Chairman, Finders Keepers in Oxfordshire.
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Housing Market
U-turn on BTL attack will not happen
The Government’s sudden attack on landlords is unlikely to end anytime soon despite widespread criticisms. The Government has come under attack for its plans to introduce a 3 per cent stamp duty surcharge on buy-to-let and second home purchases and slash the tax relief that landlords can claim on buy-to-let income. The CML is the latest in a long line of commentators calling for a Government U-turn on the buy-to-let onslaught. The trade body is urging the Government to reform its implementation plans for a stamp duty surcharge, to mitigate potentially negative impacts on the housing market as a whole. Paul Smee (left), CML Director General, said, “Our longstanding view is that stamp duty is a blunt policy lever. Given the complexity of the proposals, we also suspect that in practical terms the surcharge could cause more problems than it solves. We urge the government at least to move away from a position where people will have to pay and then potentially claim back to one where payment is deferred, and only triggered if the buyer genuinely falls into the intended target category.” But David Cox (right), Managing Director of ARLA, does not expect a change in Government policy any…
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Latest property news
Stamp Duty: the hidden issues
The new surcharge on properties purchased as second homes or as a buy-to-let has caused disbelief and fury – but there is more to it than meets the eye. David Gibbs (left), Taxation Partner at London based Alliotts accountants has the informed view, “The consultation paper makes clear that the proposed Stamp Duty charge is an additional three per cent on the whole of the purchase price. For example under the current rules, Stamp Duty on a second property costing £200,000 is £1,500. From 1st April 2016 this will rise to £7,500 – a 500 per cent hike. The draft rules are very tightly drawn so that the additional rate applies if ‘at the end of the day of the transaction’ an individual owns more than one property. “There are exceptions. If you are replacing your main home you are exempt from the charge. So if for example, you own a second property and purchase a new ‘main home’ then the additional charge won’t apply. Buyer beware – the old home must have been sold by the end of the same day that the new home is purchased. The additional rate will apply if it is. There is a proposal…
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