Quest report BTL survey instructions down by 40% on February

Quest report BTL survey instructions down by 40% on February

9:36 AM, 13th May 2016, About 5 years ago 39

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The Quest Survey and Valuation reporting systems are the most widely used by surveying firms across the UK reporting back to lenders and customers. They are therefore in one of the best positions to report on activity in the Buy to Let market as a valuation survey is only instructed once a mortgage has been agreed and is likely to proceed.quest

The figures have to be considered in the background of the rush to complete Buy to Let properties before the 3% Stamp Duty surcharge on second properties deadline started 1st April. There was a large increase of survey instructions peaking in February to give a chance for property purchases to complete before the 1st April.

Then by March, when it starts to become difficult to complete before the deadline, survey instructions drop by 30.6% against the February peak and in April, post Stamp Duty surcharge, survey instruction fell by 40%.

Quest is predicting Buy to Let instructions to remain low during May and is monitoring the market for potential threats to manipulating purchase prices and values. These threats can occur when demand falls in a market to try and buck the consequent downward pressure on prices. In this case the fall in demand is being caused by planned decreases in mortgage interest tax relief and the above mentioned stamp duty surcharge on second properties.

MD of Quest, Peter Stimson, said “with any significant changes like we have seen with the Stamp Duty rules, we do typically see a change in behaviour.

“Currently, we are seeing a sharp rise in the number of new build developments either offering Stamp Duty paid deals or appearing in property clubs offered at discounted rates.

“Particularly worrying is that rather than just one or two properties at the end of a development phase, in some instances we are now seeing entire developments appearing for sale under value.

“Lenders and surveyors really need to do their due diligence and be fully aware of such incentives and schemes to manage and control the risks associated with these.”



Comments

by Michael Barnes

21:28 PM, 14th May 2016, About 5 years ago

Reply to the comment left by "mark andrews" at "14/05/2016 - 18:29":

HMRC and Treasury say it IS a business.

by Bill Westmoreland

21:38 PM, 14th May 2016, About 5 years ago

Every business is potentially subject to tax on "money that isn't there" given the many dis-allowable expenses in the calculation of taxable profits.

A more specific case is the Supplementary Charge on North Sea O&G companies (an addition 20% on top of their 30% CT rate), which excludes finance costs.

by NW Landlord

13:41 PM, 15th May 2016, About 5 years ago

Selling or refinancing is a clear exit strategy of course it is. Are you saying that any business that has finance or uses finance to grow isn't a business absolutely ludicrous almost all businesses use finance and carry manageable debt to grow hence why the banks are so dominant. Buy to let mortgages are the same if you buy well and don't mortgage up to the hilt to leave enough equity then buy to let is an excellent business model.
I really believe I am wasting my time with you and your comments as I believe you are trying to provoke reactions. If you are a full time landlord like myself then buy to let is far from a passive investment it is a full time job and a business like any other in the country people who try to compare it to shares of equities really haven't got a clue what there on about and probably have no experience In the industry

by mark andrews

14:33 PM, 15th May 2016, About 5 years ago

Most businesses have a plan to pay off the principal DURING the term of the loan. You don't.

The strategy you use was not allowed for owner occupier mortgages, and for good reason.

Refinancing isn't a solution to paying off the debt, because your simply renewing it. Like I said, snake eating its own tail.

by NW Landlord

14:41 PM, 15th May 2016, About 5 years ago

I really don't get where your coming from and will politely agree to disagree and I will crack on running my businesses

by Sunny K

14:53 PM, 15th May 2016, About 5 years ago

You are quite right. All public and private business have a clear loan repayment strategy and hence none of them have any debt at end of loan. Thanks to these clear strategy, we live in an debt free world except of course the BTL sector.

by Richard Mann

15:06 PM, 15th May 2016, About 5 years ago

Totally agree with NW Landlord.
If the loans used to buy properties as part of a letting business are not for business purposes then why are they described as commercial loans and not covered by the FCA?
A commercial loan it is however it stops according to Gideon & tampon tax Cameron being so when justifiably expecting the interest to be a business expense.
So the only country in the world to tax loans.
Mark Andrews.
Why do assume no Lettings business person has no strategy in place to pay off the debt?
Business person Landlord entrepreneur investor Mark Alexander has been forced to change his country of residence to avoid bankruptcy and the displacement of many tenants from properties that they are extremely happy with.

Look at the bigger picture
Stop and think it out.
If private Landlords are forced out what's the alternative?
A large financial institution has just bought a a piece of land near Liverpool, fact.
It is using funds to build huge blocks of flats for people to rent.
It can manipulate the rents to create a specific return to its shareholders/ investments
Say 7 %
Should the interest paid to build the block be tax deductible?
If dodgy Dave and Gideon have their way the plan is to dump all council housing.
Large corporates can then manipulate the market.
It's already happened to our young adults attending university.
Most working people will be forced to accept what is available as private landlords will not be in the picture.
Is this like an organised ghetto?

Control of the rental market.
Dump the council housing.
Hand over to corporate manipulators.
Create corporate ghettos.
Gear rents to percentage of return.
Kill any chance of individuals to have a choice.

That's the road that all this leading to.

by NW Landlord

15:07 PM, 15th May 2016, About 5 years ago

Ha ha well said Sunny think we have a landlord / buy to let basher in the midst. Some of the biggest companies in the world are saddled with debt not to mention governments which would be a lot more toxic than most buy to let mortgages

by NW Landlord

15:17 PM, 15th May 2016, About 5 years ago

Richard what superb post and I agree with everything

Mark I have just read your post fully from last night. I have incorporated my business in to ltd company to avoid large rent hikes as I value my long term tenants. I am also diversifying into other arears as the writing is on the wall as explained so well by Richard not bad for a passive buy to let invester have got be one step ahead The public need to be carful what they wish for as once these large corporate Tory donors get there claws into the PRS people will see how valuable the private landlord is what they are doing is stamping on the little man to make way for their rich friends to clean up that's why I don't understand landlord haters it's pure jealousy that they didn't have a go themselves is my opinion

by Sunny K

15:19 PM, 15th May 2016, About 5 years ago

Reply to the comment left by "NW Landlord" at "15/05/2016 - 15:07":

I commend your explanations of why BTL is just like any other business. Clearly some people have decided landlords are bad and put forward all nonsense to justify their views.


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