S a landlord, you could be forgiven for feeling a little sorry for yourself of late. The New Year has kicked off with more stringent mortgage lending rules and the phasing out of mortgage tax relief begins in April. Not forgetting the 145 pieces of legislation landlords now have to comply with.
Still think being a landlord is a good idea? Romans thinks so.And so do landlords.The proportion of landlords seeking to expand their portfolio has risen to 45%, up from 41% in May 2016, according to research conducted by Mortgages for Business, suggesting landlords are willing to absorb the increased costs and remain in the investment market.
True, the lettings landscape has changed dramatically of late, but there are still so many positives. Property is still the most lucrative investment vehicle when compared to other commodities such as stocks and shares and gold – just look at the capital appreciation of property across the South East in the last few years.
Yields remain strong as rents continue to increase, up 3.9% in England in 2016 pushing the average rent to £892 per month in December according to Homelet. In fact, average rental values have increased in 11 out of 12 regions in the UK, compared to the same period last year. Rightmove predicts this trend to continue into 2017 with a further 4% rise across the country (outside London).
Yes, some landlords with large borrowings will struggle with the tighter lending rules, as lenders have to take into account a landlord’s costs and expenses as well as rental income when assessing their buy-to-let application.
And 60% of investors say they will be affected by the tax changes being phased in from April, limiting the amount of tax relief on mortgage payments landlords can claim.
The solution to these challenges in 2017? Get good advice from expert industry professionals you can trust.
Richard Frost, lettings manager explained:“Landlords need to understand how all these changes affect them, and seek advice to make the right decisions for their individual circumstances.This includes mortgage and tax advice from professionals and investment advice from local property experts.
“All the projections for rental growth and capital appreciation over the next 5-10 years make property a very attractive asset class,” added Richard.
For expert lettings advice contact your local branch on 01344 985 870.