Enlarge/Change font size hereA A A
“The Landlord instructions fall as rent forecasts edge up”
The UK residential market survey which is used by many key institutions including the government and the Bank of England, highlighted yesterday that the impact of tax changes continues to rock the Buy to Let market.
The results show the New Landlord Instructions series in the latest three-month period has slipped to a net balance of -9%. The declines in instructions are taking place in virtually all parts of the country – a telling sign that the changes are deep rooted, and the Government has made the landlord industry simply too difficult to enter and too unrewarding to stay.
The RICS commented “Withdrawing tax breaks that small landlords relied on, placing an extra 3% on second home Stamp Duty, and failing to stimulate the corporate build to rent market, has understandably impacted supply.”
The irony of course is the feedback shows a decline in the properties available but no shift in the Tenant Demand indicator.
One surveyor from the West Midlands commented: “Supply issues, possibly due to the exit of some private buy-to-let investors from the market during the last 12 months, continue to exert an upwards pressure on the level of rents”.
So, this leads to the good news for the landlords that remain – Over the next twelve months, rents are projected to increase by a little short of +2% nationally. A small consolation for remaining resilient despite the growing pressure and uncertainty on their livelihood.
While the report does include some predictions about the future “a cumulative rise of around +15% (based on three-month average of responses) expected by the middle of 2023”, it really throws more shade than it does light on what’s to come. It highlights the volatility of the industry and how important is for the Government to consider the private rental sector as a whole. Because if it doesn’t, and the policies and taxes continue down the current route, the sector won’t need to be considered at all for much longer – it will be dead.
◊ PROTECT YOUR RENT ◊
In our uncertain economy can you afford to lose your rent? if “NO” then take rent guarantee and legal expenses insurance with us. from just £90. – call 0800 9994 994 or look at our policies online at Rentsafeuk.co.uk
Tenant Referencing UK is the only UK company with genuine lifestyle tenant histories uploaded by Landlord & Letting Agents. Read why (CLICK)
It is apparently what the government, in the guise of George Osborne, wanted. It has achieved its aim, now it must address the mess it has made.
I put up rents at every opportunity, whereby many years ago I was happy to keep them static and just be content with making a few quid and having good, happy tenants.
Successive conservative government meddling, taxes and legislation has driven a bigger wedge between landlords and tenants than ever before.
In the old days an AST was a thing between two people that worked for the same goal a good home at a good price, however these days an AST is started out with both sides being on the defense and that is simply not right.
Ms May this is why I don’t want to do anything anymore.
I recently thought about refurbishing a country house and sat down with my business plan.
So here I go on me ciggy packet.
I invest £1,00.000 pounds of my hard earned cash and pay £73,000 in stamp duty tax.
I then spend £250,000 on the contractors of which 20% = circa £50,000 is vat.
Tax paid so far £123,000
I then sell the property for 1.5 million and make a cool £500,000 gross profit less my £250,000 refurb costs and £123,000 in taxes leaves me with £127,000 profit. I then have to pay the government 20% Capital Gains Tax on the deal which gives them another £25,400.
So for me to buy the property, do the refurbishment, take the risk and sell the property I earn net £101,600 and for the government to let me do the deal they get £152,400.
Dear Ms May, this is why UK entrepreneurs are bailing out of this country like rats off a burning ship..
Most Users Ever Online: 755
Currently Browsing this Page:
Mary Latham: 2194
David Price: 1694
Patricia A: 1017
DATA CONTROL: 973
Guest Posters: 2603
Newest Members:stevop79, waldronli, lyttonre, samyusuf, damienfegan, enviro2000
Moderators: News @ Tenant Referencing: 1629, laura: 15, Chloe: 107, lucybarr: 0, jaswhite: 20
Administrators: Paul Routledge: 3428