In the wake of this year’s Summer Budget, it is fast becoming a different landscape for investors looking to own a buy-to-let property. In an attempt to balance the affordability scales towards the homeowner rather than the investor, Chancellor George Osbourne has set the amount that landlords can claim as relief at the basic rate of 20% compared to the previous top level rate of 45% (set to be phased in from 2017). It is thought that this move will curb the recent boom in the sector which is creating a supply and demand issue amongst those looking to get onto the housing ladder.
Fast-forward to the Autumn Statement and George Osbourne has hit buy-to-let property investors again in the pocket by announcing anyone buying a second home or buy-to-let will have to pay an extra 3% Stamp Duty Land Tax on the property.
It’s not all bad news, the buy-to-let mortgage market has accounted for more than 15% of all mortgages being taken out in the UK this year – investors are still showing confidence in a buy-to-let property being a safe place to put their money.
If you’re looking to become a landlord it’s going to be a difficult time but could still worth it if you find the right property. The rental market is continually growing as a result of people who don’t own their own home finding it harder to fund a property purchase. If you can find an investment opportunity in the right location at the right price there’s no reason why you can’t make it work.
Many industry experts have commented that in the wake of the 2015 changes that the price of renting a property will be forced upwards.
New Form 6A to replace Section 21 Notice
The Government has introduced a new Sections 6A Form to replace the old Section 21 Notice which means that you can not evict a Tenant if you have not given them an Energy Performance Certificate, a Gas Safety Certificate or the governments own How To Rent leaflet.
What’s the advice?
There’s no doubting that 2015 has been a difficult year for the buy-to-let market. The Government are trying to make housing more affordable, especially for first time buyers, it’s the investors and the high-value property owners who are going to suffer. The general advice for landlords and potential investors is that you should think about the long term, consider the risks and consult a specialist to figure out the best strategy going into 2016.
For investors considering entering the buy-to-let market, make sure you get professional, current and genuine advice from market experts – visit our buy-to-let page to find out more.