Summer Budget 2015 – Landlords Reactions

The good news is that the Deposit Protection Service has finally sent out its ‘Open House’ newsletter and it features the ‘tax change.’ The bad news is that I can’t open the link. If anyone else receives this email and they can open the link, can they cut and paste the contents here so that we know what they’ve said to the (possibly) hundreds of thousands of landlords that should have received it?
I’ve sent them an email saying I can’t open it.

Reply to the comment left by “Barry Fitzpatrick” at “01/10/2015 – 15:17“:

No reply to my FOI request yet
If they stick to the 20 working day limit I should get something tomorrow

Reply to the comment left by “Ros .” at “01/10/2015 – 16:47“:

I just managed to read it and it’s absolutely rubbish. This is what they wrote:

‘Big Changes to Tax Relief

In his recent budget, the Chancellor announced a shake-up of the tax relief rules landlords can currently take advantage of. The capping of buy-to-let mortgage tax relief to the basic 20% tax rate has divided opinion, with many people suggesting it will price landlords out of the market and ultimately drive rents up.

Others, however, have suggested that it levels the field of landlord taxation with homeowners who can’t claim tax relief on their mortgage repayments, making it fairer for everybody.

Then there are some who claim that landlords should treat the renting of their property as a business rather than simply as an investment, and should, therefore, be taxed accordingly.

Much of the discussion rests on whether landlords view buying a property to let as a way to get more money coming in every month, or whether they see it as a long-term investment, relying on the house to increase in value over time.’

What a waste of all my time and effort and others’ trying to persuade them to get the message out, asking them to put a link to the petition, to get people to write to MPs etc. From what they wrote, it’s clear that they see no obligation to support landlords, but instead want to present a ‘pseudo’ impartial stance.
I will be writing to them and giving them my opinion and ask others to do the same – politely and constructively of course. The email address is:

[email protected]

But since they send the stupid thing out about every two months, they’ve really let us down. And they don’t seem to realise that they too will lose a hell of a lot of business. They even put something about ‘rogue landlords’ first as though that were the big issue facing our sector.

Having said that, this is a long game, as I said earlier, so we have to keep up the pressure and get them to write something a lot better next time.

They also ask us to complete a survey, which I did – but I have no idea what, if anything, they will do with it. They imply they will give the results to Government.

Reply to the comment left by “Barry Fitzpatrick” at “01/10/2015 – 15:17“:

Hi Barry

I’ve not had a response to the FOI that I submitted (on 5th September) yet.

“Under the terms of this Act we have 20 working days to comply with your request.”

Tomorrow is the 20th working day since it was submitted, so hopefully I’ll get the response and share it by close of play tomorrow.

https://www.cml.org.uk/news/press-releases/4198/

Graph showing arrears bet BTL and OO

From Sheriffs Office
Landlord repossessions increase
Here we see a different picture emerging. The annual total of claims issued in 2014 for repossession of rented residential premises was 161,300. This is 5% down on the previous year. However the numbers of court orders made, the number of warrants issued and the number of repossessions actually carried out in 2014 have all increased since 2013.
Indeed, for repossessions of rented residential premises, the figure for 2014 was in the region of 42,000. This is the highest figure recorded since the MoJ started collating such figures in 2000 and an increase of 11% on the figure for 2013.
Why is the rented sector heading in the opposite direction?
Why the divergence? Why are figures for repossession in the rented sector heading in completely the opposite direction to those in the mortgage sector? The answer is probably obvious.
Private landlords cannot afford to have tenants in place who are not paying their rent. Their costs, especially in buy-to-let properties where there is still an underlying mortgage being paid off by the landlord, do not go away just because the tenant is not paying their rent, and as we have seen from the CML figures, mortgage lenders are rather less tolerant of buy-to-let borrowers going into arrears than they are owner-occupiers.
When their tenants go into arrears, they need to act quickly if there is little evidence to show that the tenant is going to be able to get things back on track quickly.
Quick, decisive action is essential – getting that court order is essential. Getting your former tenant out so that you can get new paying tenants in is a priority. The question then becomes who do you get to enforce it? Do you wait for the county court bailiffs to get round to doing it – or come and see a specialist High Court enforcement company such as ourselves for advice as to how we can help you?

Reply to the comment left by “Ros .” at “01/10/2015 – 17:07“:

Hi Ros, The TDS have just sent out an email as well. At least theirs has a link to the petition! I’ve sent it to Mark A and he can forward it on to you.

According to the Ministry of Justice data, the total number of UK property repossessions in 2014 was 41,965, up 11% on 2013 property repossession figures.
The initial data may appear to be somewhat alarming but it isn’t all bad news, there has been a significant drop in the number of private rental sector (PRS) landlords seeking possession of their rental property assets due to increasing rent arrears.
http://blog.legal4landlords.com/index.php/is-rent-protection-behind-fall-in-number-of-prs-repossession-claims/

Analysis: Buy-to-let will support long-term aspirations too
By Paul Thomas 2nd September 2015 12:00 am
Uhi_Jackie_Barclays_2015
The buoyancy of the buy-to-let sector has been well documented and this trend is likely to continue both nationally and regionally.

While it remains vital for landlords to buy the right property in the right area to secure the right rental yield, growing numbers of existing and potential landlords are looking at this market with longer-term financial aspirations. According to Barclays data, three-quarters of buy-to-let homeowners are choosing to purchase their property to invest in their family’s future, including retirement and supplementing university fees.

In addition, despite the planned tax relief cuts, only 9 per cent plan to sell their buy-to-let property, with 23 per cent considering the idea. This confidence in the rental market, and in buy-to-let as a form of valuable financial support, emphasises the positive strides being made throughout the sector.

It also underlines the growing opportunities for intermediaries and the need for efficiency and professionalism when working with buy-to-let clients.

One simple rule is to ensure that the expected rental income is accurate and realistic. Many cases do not complete because these expectations are not met after the results of a survey.

58% of brokers want Osborne to scrap ‘unfair’ BTL tax relief cut
By Paul Thomas 11th September 2015 5:12 pm
Nearly six in 10 mortgage professionals believe Chancellor George Osborne should reverse his proposed cuts to landlord tax relief.

A Mortgage Strategy poll of 192 readers shows 58 per cent believe Osborne should scrap plans to limit the tax relief landlords can claim on property finance costs to the basic rate of income tax.

The Buy to Let Business managing director Ying Tan says: “I think George Osborne should reverse it but I don’t think he will, so we should embrace it.

“We will evolve. The people who it is really hard on are the people who have spent years accumulating wealth and I am not sure that is fair.

“It is not a very liquid asset so it is not like you can sell everything before 2017 – it is pretty harsh. The other thing is they did not engage the market as much as they should have before taking the decision.”

Tan says those who believe the Chancellor should continue with the reform are underestimating the impact it will have on the sector.

click here
He adds: “I don’t think some people understand the full impact [of this reform]. And some brokers may well perceive that any damage done to the buy-to-let market will benefit the residential market.

“So it does not surprise me that there are so many people who think it is not a bad thing.”

Landlords have already voiced their concerns and have started a petition to persuade the Chancellor to reverse the changes. To date, it has gathered more than 26,600 signatures, although it needs 100,000 before it can be considered for debate in parliament.

Landlords say they have been unfairly targeted. The petition adds: “We operate as sole traders and incur costs in the course of running our business. The planned restriction will unfairly target us by preventing us from offsetting costs in the same manner as other sole traders.

“We ask that the planned restriction be reconsidered as it has unfair implications.”

However, the Government says just 18 per cent of individual landlords are expected to pay more as a result of the changes.

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Court delays “costing agents and landlords thousands”
https://www.lettingagenttoday.co.uk/1277-court-delays-costing-agents-and-landlords-thousands

So if we need to sell are we going to get quicker evictions! bet no thought as been given to this.

How many extra evictions do they think there will be?