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TODAY'S OTHER NEWS

Landlord confidence at an all-time low

Landlords’ confidence in the buy-to-let sector has collapsed, according to the National Landlords Association (NLA).

Confidence in landlords’ business expectations has tumbled to just 29% - the lowest level since the NLA’s survey began in Q4 2006.

Confidence levels dropped sharply in the second half of 2015 in response to George Osborne’s changes to landlord taxation, but had until now remained above 35%.

This represents a marked shift in confidence since the government announced its proposal to scrap section 21 eviction notice.

Regionally, confidence is highest in the East Midlands and in Yorkshire and the Humber - both 34%.

Confidence is lowest in the North East (18%) and central London (19%).

Richard Lambert, CEO of the NLA, commented: “With the amount of change that has occurred over the last four years and now the proposal to abolish no-fault evictions without any certainty that the courts will be able to cope with the increase in cases this will create, it’s no wonder that landlords are pessimistic about their future.

“Landlords need to be confident in their own businesses for the private rented sector to function properly. Given that it’s expected to compensate for the lack of social housing, it is vital that this confidence is restored.”

Poll: Do you expect landlord confidence to be restored anytime soon?

PLACE YOUR VOTE BELOW

  • G romit

    Who would have thought that with 20+ tax and regulatory changes none of which favour Landlords over the last couple of years and more anti-Landlord changes on the way, that confidence is low.

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    Yes my confidence is at 41 years low / Zero.

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    It's only a sellers market no reason to take such huge risks for negative results.
    On its current form PRS is finished. Good luck with the increased housing crisis and homelessness. That's really going to challenge those labour strong holds rallying shelter for all the glorious changes.

  • Mark Wilson

    Too good for too long comes to mind. Things change! When I bought my first property to live in there was tax relief on interest payments. Buy to let Landlords today, I expect equity release will be the next sector to be hit . No one will see it coming but it will arrive.

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    It’s not relief it’s a bloody cost

  • Paul Barrett

    The BBC refused to correct it's reporting describing S24 as withdrawing generous tax reliefs.
    Such vile propaganda disseminated by the vile BBC was an outrageous attack on the only part of business in the UK; namely mortgaged sole trader LL that were to be restricted in offsetting debit loan interest against income to arrive at a hoped for taxable profit.
    This is a fundamental business concept going back at least 200 years!!
    It is accepted by all those in the business community that GAAP apply.
    Govt has decided that mortgaged sole trader LL are to be the only business group that will not be subject to GAAP.
    This is clearly bonkers but then we are talking venal political policy rather than logical business practice.
    As such mortgaged sole trader LL are to be the only group that will be taxed on gross income while ignoring costs than any other business would be able to offset against income to produce a hoped for taxable profit.
    When you have such a clearly political policy the only way it will change is for the politics that generated the policy to be changed by those who disagree with the avowedly political policy.
    I suggest that currently the politics simply aren't there for abolishment.
    That means for the forseeable future LL investing in their own name using mortgages will have to factor the bonkers S24 into their business plans.
    I know if S24 was around when I first started out 12 years ago I would have invested via a company or I would have bought just one property with cash.
    S24 is now a massive business impediment for sole trader LL.
    I believe as evidenced by how many corporate BTL mortgages are being taken out that we are seeing a transfer of investment from LL own name to corporate entities.
    The logic of this is at some stage all mortgaged LL will have invested as corporate entities.
    That logic must surely leave the PRS in exactly the same position as before S24 was imposed.
    The whole alleged reason for S24 was to drive small LL out of business.
    If all the sole trader LL new and old become corporate entities then how will Govt achieve it's objective of eradicating private LL!?
    The logic must surely be that once all LL are corporates then Govt will need to impose a similar S24 policy on corporates or at least some sort of policy that will have the same effect as the currentt S24 policy is having on mortgaged sole trader LL.
    Those LL who believe they have escaped the S24 turnover tax are deluding themselves.
    The logic of the S24 tax policy must be that the Govt will visit on corporate LL a tax policy which will have very similar effects as S24.
    LL need to be cognisant of this very likely reality and adjust their business models accordingly.
    I know if I was a corporate LL I would arrange my business model to include no more than 50% LTV gearing............................just to be safe!!
    So my suggestion is that they have come for the mortgaged sole trader LL.
    They will come for the corporate LL soon!

    Be afraid; be very afraid of what Govt can do to small LL.
    It is obvious that a S24 tax policy will never be imposed on large corporate LL.
    It would bankrupt them if Govt tried it.
    So all told very torrid times for small LL in the near future.
    I'm getting out of the AST game.
    The figures and risk just isn't worth it anymore for me.

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