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Trade body fears mass sell-off of buy-to-let properties

A growing number of buy-to-let landlords are planning to sell-off their properties as the government’s punitive new tax changes cause investors to quit the market, new research shows.

The pending removal of landlords’ mortgage interest tax relief from next month, coupled with the 3% surcharge on stamp duty introduced last year, is deterring many buy-to-let investors, according to the National Landlord Association (NLA).

The fact that the government is using landlords as scapegoats for problems faced by first-time buyers by tightening buy-to-let taxes has seen the proportion of landlords looking to sell in the next 12 months more than double since July 2015, from 7% to 16%, which would drastically reduce the supply of much needed private rented homes, the study by the NLA has revealed.

As well as selling up their existing properties, 84% of buy-to-let landlords now say they are no longer looking to add to their property portfolios.

Consequently, the NLA predict that there will be a net reduction in property transactions by 2018, adding to the supply-demand imbalance in the market, which is likely to drive rents up.

Richard Lambert, chief executive at the NLA, said: “There has been a clear correlation over the past year between our findings on what landlords have told us they intend to do in terms of buying and selling in the coming year and their actual transaction activity.

“If the trends keep moving in the same direction, then by 2018 we’ll have more experienced landlords selling than buying, contributing to a net reduction of private rented properties.” 

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    Yes they are right.. I've just sold a flat earning 6.25% yield (4.5% after costs).. bought and sold in a year and made 12k profit after all costs and here the reason... Had I invested my 150k in 1/2 a bar of gold, i would have made £50k (before tax).. and what really hurts.. I had a further £150k in the bank doing nothing.. So I've lost around 75k (after tax)... ouch!!!

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