It is understandable that the buy to let (BTL) changes have caused many landlords to consider their position and review if the position is still financially viable for them. The BTL changes come into effect from the 1st of April this year and there is also the change to mortgage payments tax relief scheduled for next year to think about. There is a lot for landlords to think about at the moment but whenever you deal with a property investment, it is always best to think about things with respect to the long term.
Yes, the short term impact will be a negative one but with “bricks and mortar”; the point of investment lies in the long term.
Research across the United Kingdom suggests that the continued rise in property prices will be more than enough to justify buying property to let out. With the average annual capital gain for a property coming in at around £28,000 the average stamp duty for a second home is slated to be around £11,000 which means that there is still a chance to make a great return on buying property, even without considering the letting market.
The Greater Manchester market will be affected
As you would expect, the returns for the London area appear to be even greater but in areas like Stockport and South Manchester, the long term view suggests that the BTL changes won’t have as much of an impact as is currently being made out. There is a need to bear in mind that this is a government driven change, and there are media outlets that are keen to promote the government view, so there has been a lot of scaremongering about the impact on landlords. It is best to speak to an experienced estate agent about the likely impact, and this is something we are happy to offer at Spencer Harvey estate agents.
If you would like to arrange an appointment to speak about the changes in the buy to let market, get in touch and we’ll be more than happy to meet with you.
In reality, the latest changes will likely have the biggest impact on tenants. In the short term, landlords will be paying more to obtain property and this means is likely to be passed on to the tenant with increased rental fees. A recent survey by a major online estate agent suggests that 70% of landlords expect rents to increase to justify their increased expenditure.
This is bad news for tenants, but it should mean that in the grand scheme of things, not a lot changes for landlords. The property market in Stockport and the south of Manchester is tipped to carry on rising, and this means that there is going to be a high demand for rental opportunities. Landlords may need to find more money initially to buy property but in the long term, there are still profits and positive returns to be made.
Anyone concerned about what these changes, and the ever changing nature of the property market will mean to them should get in touch with Harvey Scott estate agents and we’ll be more than happy to talk.
https://www.spencerharvey.co.uk