Summer Budget 2015 – Landlords Reactions

The biggest problem is what comes next?
I can see the current government will like to totally stop the growth of the BTL market and to be honest I think we can all probably accept its got a bit ahead of itself. IF the ONS data is correct the rental stock has been growing by about 250,000 homes a year (about half cash purchase half mortgage) which is probably unsustainable. If BTL goes away the rental stock will still grow each year but by around 125,000 units a year or maybe a little less

I fear the remaining 20% will go in time which will make only cash purchases and perhaps high deposit (50% plus) purchases possible without negative cashflow.

However there is a much worse possibility which I think there is a chance the current government could implement a few years down the line (and almost certainly a corybn government would do). If it is implemented the whole market will go down in real terms (that is to say prices probably wont fall but we could see 20 years no no house price growth)

Reply to the comment left by “Appalled Landlord” at “16/09/2015 – 13:41“:

“Why should existing customers go on to SVR’s?”

I meant if they make it so the current rules stay for current mortgages but the new rule for new mortgages then the current BTL owners with mortgages will have no choice but to go onto their SVRs which are expensive and in many cases probably not viable (especially with some silly lenders that charge 6%+ on the SVRs or 5.5% above BOE)

Also there is the problem of a much more complicated tax return. HMRC would need to effectively write and check code for two types of owner pre and post change.

I simply cant see that they would allow current mortgages to be offset against tax but not new ones. and even if it happened it would likely force people onto expensive SVRs

Reply to the comment left by “Roger Rabbit” at “16/09/2015 – 13:42“:

Roger, I think your theories are just theories.

I always knew that, HPC participants lived in Cloud Cuckoo Land.

BTW, where do you get this wishful list from?

Reply to the comment left by “Saeef Khan” at “16/09/2015 – 13:48“:

which list?

Reply to the comment left by “Saeef Khan” at “16/09/2015 – 08:45“:

Maybe part of the problem is the number of landlords that are not declaring / making any profit on btl’s. Whilst I do not agree with the tax change, it is an unavoidable tax charge if you have a mortgage.

Reply to the comment left by “BTL INVESTOR SCOTLAND” at “15/09/2015 – 23:27“:

At least they see rents rising and it not being good for FTB renting and trying to save.

Reply to the comment left by “Mark Brown” at “16/09/2015 – 00:00“:

I disgust you, ouch – you may get your wish, unfortunately I think the government will move in on us cash landlords too.

Clearly not the place for further challenge to help direction nor can I add to your Oscar Wilde type wit. However, it does appear as though your insults have been lifted directly from my business plan and mission statement.

Signing off. Sent from my iPhone

Reply to the comment left by “S.E. Landlord” at “16/09/2015 – 15:26“:

You write: ‘Maybe part of the problem is the number of landlords that are not declaring / making any profit on btl’s.’

I agree that any LLs who do not declare are unlikely to sign the petition. Most incorporated or unencumbered (ie mortgage free) private landlords are also unlikely to sign or join the ‘fight’. I would suggest that David Price is presumably the exception, not the norm, in that he is unaffected by this tax grab but is still standing up for logic and what is right.

The fact that Clause 24 is targeted solely at encumbered and non incorporated LLs ONLY, rather them proposing some sort of NPR levy or mechanism to penalise ALL LLs, severely weakens Osborne’s ‘level the playing field between FTB and private landlords’ rhetoric?

As far as non declaration of income and also the HMT coffers AND ‘levelling the playing field’ subjects are concerned:

Most tradesmen offer a ‘discount for cash’ to home owners AND landlords, to avoid tax. As a 40% tax payer, soon to be 45% due to the ‘Alice in Wonderland’ tax there is no benefit to me to accept tradesmen discounts for cash as a landlord. However, as a homeowner, there IS of course a benefit for me to take a tradesman ‘discount for cash’ for work done at home, not that I would ever agree to take part in that HMT robbing exercise done frequently by other OOs I know.

BTW for most required work at home I do myself, but for rental properties I use professionals.

An article Landlord Today states the biggest barrier for renters to get on the property ladder is raising a Deposit.

https://www.landlordtoday.co.uk/breaking-news/2015/9/homeownership-a-distant-dream-for-nine-million-renters#comments