Whilst we are not surprised that the Chancellor failed to reverse the additional 3% SDLT on second home purchases nor reinstate the mortgage interest tax relief for buy-to-let landlords in today’s Budget, we hope that this will be considered in future as it has dramatically reduced the number of small/individual buy-to-let investors. Many have been deterred from investing, and the looming ban on estate agent’s fees to tenants is likely to lead to another charge being pushed towards landlords.
We’re also currently discussing the effects of ATED (Annual Tax on Enveloped Dwellings) with a number of landlords, most of whom are looking to offload their investment properties with a view to taking their money out of the UK. Most of these landlords had bought property using a Special Purpose Vehicle (SPV). Capital growth is down, and investors are no longer willing to ride out the storm, particularly whilst paying higher tax rates. However, there is currently strong demand from first-time buyers with plenty in the market looking to purchase property up to £2m, so now is a good time for those investors who have made capital gains to exit.
I do think we will see more institutional investor landlords coming into the market from overseas, particularly with the weaker pound which has seen more US dollars and euros coming into the UK. However, these institutional buyers are looking for large discounts of up to 20%. The upcoming elections in Holland and France may see a more right-wing regime for both countries. If this does happen, it could well push the euro down which will mean investors trying to negotiate prices down as a result.”
For more information on Red, please visit www.redpropertypartnership.co.uk or contact 0207 485 1332 for more information.
Featured in MoveToLondon moveto.co.uk on 22nd March 2017. A stunning example of a lateral conversion of two adjoining apartments in Camden Town, NW1. At almost 1,700 Sq.Ft, the apartment boasts a 70 ft terrace with direct access to a communal residents garden.Read more
For almost 30 years Bridgestead Estates worked from 24 Bickenhall Mansions where selling, letting and managing properties was just part of the job; building strong relationships with its residents and landlords was more of the day to day enjoyment of being there. Red had been working closely with Mathew Donavan and Andrea Slatter for a number of […]Read more