It is not the best time to be a buy-to-let landlord at the moment, with a raft of changes introduced by the government prompting concern that buy-to-let landlords with low profit margins could end up making a loss as a result of various tax changes, which will push some out of the market altogether.
The introduction of the 3% stamp duty surcharge in April, the scrapping of the 10% Wear and Tear tax relief, the fact that mortgage tax relief is set to be phased out from next year, the need for landlords to now check the residency of their tenants, and now the Bank of England’s Financial Policy Committee will be granted greater powers over the buy-to-let market next year. The list of negative changes in the sector goes on.
Unsurprisingly, a new Martin & Co survey shows that 92% of buy-to-let landlords believe the government is ‘anti-landlord’ and are now calling for the chancellor to back them in the Autumn Statement.
The research also found that 74% of buy-to landlords would like to see this year’s stamp duty changes scrapped in the Autumn Statement.
In addition, more than 50% of this group would like the Philip Hammond remove the punitive changes in mortgage interest tax relief, which comes into force in April 2017.
Ian Wilson, chief executive, Martin & Co, said: “The government seems to be set on making life as difficult as possible for property investors, while ignoring the fact that landlords provide essential rental properties in locations where there are housing shortages and no realistic ability to buy.
“People are relying on the private rented sector to supply property, so we need the Chancellor to back our landlords and encourage them to continue to invest and provide a vital pipeline of homes for people who simply cannot afford to buy.”
Eddie Goldsmith, chairman of The Conveyancing Association, is among those that believes that this week’s Autumn Statement represents “a pivotal moment for the UK housing market” because the “anti-landlord and investor policies” introduced by Osborne, coupled with the Brexit vote, has led to something of a “perfect storm”, which if allowed to continue could “reduce transaction levels to rubble for many months to come”.
He said: “It may be too much to hope that the 3% extra charge on additional property stamp duty will be abolished, but such a move – as well as a u-turn on next year’s mortgage interest tax relief changes – would be most welcome.”
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