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The Mortgage Works

The Mortgage Works is a specialist lender supporting Landlords with buy-to-let mortgages for over 30 years. Today we focus on offering a flexible approach to lending, with a range of mortgages designed for landlords:

  • Portfolio landlords

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As a specialist buy-to-let lender of Nationwide Building Society, The Mortgage Works is home to over 700 dedicated expert team members, providing support for just over 330,000 UK landlords.

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A look into 2024 so far: 3 key insights for landlords

16 April 2024 2081 Views

A look into 2024 so far: 3 key insights for landlords

Twenty twenty-four is a pivotal year for landlords in the Private Rented Sector (PRS). It is still the Government’s aim that the long-awaited Renters (Reform) Bill will pass into law towards the latter part of the year with landlords bracing themselves for the implications of this legislation. Political transitions will also be part of landlords’ thinking around the potential policy shifts and regulatory reforms that could reshape the PRS.

Against this backdrop of uncertainty landlords face both challenges and opportunities, from navigating shifting market dynamics to ensuring compliance with evolving regulatory requirements. The Mortgage Works is committed to landlords and working to influence policy, providing key actions to Government driving towards a thriving Private Rented Sector.

Read on as we explore 2024 so far, and keys insights anticipating the impact of the Renters (Reform) Bill and navigating an election year.

1. The Renters (Reform) Bill

The Bill sets out to improve the housing system for both the 11 million renters and 2.3 million landlords in England and is expected to become law this year. Minor changes have been made as the Bill has progressed through Parliament, but it broadly remains in its original form. The Bill is currently waiting for its report stage in the House of Commons, allowing MPs to debate further amends, before it is moved to the House of Lords. If Parliamentary time allows for it to complete its passage through the House of Lords ahead of a general election it will then pass into law.

What is in the Bill?

The Bill has been developed in consultation with landlord and tenant groups over the past 5 years, it includes:

  • An introduction of comprehensive eviction grounds so landlords can still recover their property and easily take possession of their property where the tenant is at fault

  • Giving tenants the ability to appeal against excessive above-market rent increases which maybe designed to force them out through backdoor evictions. There will also be an independent tribunal to make a judgement, including determining the actual market rent of a property

  • An introduction to a new Private Rented Sector Ombudsman to provide fair, impartial, and binding resolutions to many issues – proving quicker, cheaper, and less adversarial than the court system

  • The creation of a Privately Rented Property Portal designed to help landlords understand their legal obligations as well as providing information for tenants to better understand their tenancy agreement

  • Giving tenants the right to request a pet in the property, which a landlord must consider and cannot unreasonably refuse. Landlords will be able to require pet insurance to support this.

While the abolition of section 21 no-fault evictions is also included, it has recently been recognised that it will only occur when “sufficient progress has been made to improve the courts”, the Government has suggested these improvements include:

  • Making the court process digital

  • Working through how courts can prioritise disputes when anti-social behaviour is involved

  • Improvements in bailiff recruitment

  • Providing more advice and counsel to landlords and tenants

What does the Bill mean for landlords?

When the Bill does become law, it will not mean that landlords will have to comply will all elements of the Bill on day one. For example, the timing of when the Ombudsman will come into force will likely be determined by future regulations set by the Secretary of State.

The Mortgage Works recognises that the Bill represents a package for change that has broad agreement across the sector. However, there is concern that following the introduction of the Bill’s measures, there may be a disconnected approach to regulation which will cause increased uncertainty to landlords. Read more about our call to Government on actions that can be taken to improve the PRS here

2. Spring budget 2024: Capital Gains Tax reduction

The recent spring budget saw the Chancellor announce a drop in Capital Gains Tax (CGT) from 28% to 24%. This reduction could significantly impact on landlords’ tax liabilities when selling investment properties.

Landlords may consider selling properties to take advantage of the lower tax rate, while others may adjust their long-term investment plans accordingly. It may be worth exploring tax planning opportunities in light of this change by consulting with a financial advisor or tax specialist. It’s essential to stay on top of tax law and regulations as they are subject to change.

3. 2024 general election

There may be some uncertainty around the upcoming general election and what a change in Government could mean for landlords. A general election can have various implications, depending on the political landscape and policies proposed by different parties:

  • Housing policies: Different political parties may have divergent housing policies that could directly affect landlords. For example, parties might propose changes to regulations governing rental properties, taxation of rental income, or incentives for affordable housing.

  • Market confidence: General elections can create uncertainty in the housing market, potentially impacting investor confidence and rental demand. Landlords may experience fluctuations in property values and rental prices leading up to and following an election.

  • Legislative changes: A new government resulting from a general election may introduce legislative changes affecting landlords. These changes could include amendments to landlord-tenant laws, rental property standards, or tax regulations impacting property investment.

  • Economic policies: The economic policies of a winning party could influence factors such as interest rates, inflation, and overall economic growth. These macroeconomic conditions can indirectly impact landlords through their effects on property values, financing costs, and rental market dynamics.

  • Housing supply and demand: Housing policies proposed by political parties can affect the balance between housing supply and demand. For example, initiatives aimed at increasing affordable housing or promoting homeownership may impact the availability of rental properties and rental prices.

In the ever-changing landscape of the PRS, 2024 presents both challenges and opportunities for landlords. Staying up to date will give landlords the ability to make informed decisions and adapt where needed.

Our commitment

The Mortgage Works, the specialist buy to let lender for Nationwide Building Society, is an influential lender in the private rented sector. As one of the largest providers of buy to let mortgages in the UK, we’re committed to influencing policy and championing landlords to ensure the private rented sector works effectively.

Read more about our commitments to improving the private rental sector.    

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