Are you one of them? Two thirds of landlords fed up with higher taxes and red tape

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Tougher tax rules and red tape have caused two-thirds of landlords to consider investing outside the private rented sector in future.

New research from FJP Investment reveals that the market has lost its appeal for many, with 68% of multiple property owners reporting that buy-to-let investments have become far less attractive during the past five years.

The survey of 1,004 UK landlords and property investors, of which 344 own two or more properties, found that 71% believe they have been unfairly targeted by the government’s tax reforms and new regulations since 2016.

Two thirds (67%) said they would consider other forms of property investment that didn’t incur the same taxation and complexity as buy-to-let and second home purchases.

Two fifths

More than two fifths (44%) of landlords said they plan to sell one or more of their properties in 2021 although the same number intend to buy a house or flat this year.

However, confidence is high in regard to house prices; more than half (55%) believe prices will rise in the next 12 months, while 54% expect prices to increase by more than 10% between now and 2026.

CEO Jamie Johnson (pictured) says that although property investors are confident house prices will rise, the added cost and complexity of investing and letting out multiple properties means many are looking for other forms of bricks and mortar investment.

He adds: “With the stamp duty holiday extended until the end of June and the UK inching towards an end to lockdown, the next few months will be critical for the property market. Time will tell if there is indeed a mass exodus of investors from the buy-to-let sector, but this new research underlines the fact that there is far less appetite to be a landlord.”

Read more about selling buy-to-let properties.

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LATEST: Government’s annual housing benefit bill rises to £30 billion

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The government is expecting to spend and eye-watering £30 billion on housing benefit for tenants this year, DWP minister Will Quince has told parliament.

This figure is £8-10 billion more than the Office for Budget Responsibility forecast would be needed for 2020/21 before the pandemic struck and reflects the huge financial strain the welfare state is under during Covid.

Quince’s answer came in response to questions from several MPs in parliament who are concerned that rent arrears are building to unsustainable levels.

Conservative MP Bob Blackman (pictured) said that: “The evidence produced by the National Residential Landlords Association and a lot of housing charities demonstrates that rent arrears are growing and growing very fast such that they will probably never be repaid.”

Quince, who is the Parliamentary Under-Secretary of State for the DWP, said Ministers were worried by the problem of mounting rent arrears too but said the government’s huge housing bill and other measures demonstrated it was doing all it could to support struggling tenants on benefits.

He also said the £30 billion excluded the £1 billion spent on raising the Local Housing Allowance threshold to the 30^th percentile, and that landlords and tenants are now able to request that rent is paid direct to a landlord online if ‘financial harm’ is likely.

But as LandlordZONE has reported many times in the past, the Alternative Payment Arrangements or APAs Quince refers to are not as easy to arrange as he claims.

Landlords requesting APAs can face a glacially slow and often unstaffed bureaucracy which is too easily outwitted by tenants intent on pocketing housing benefits payment rather than passing them on to landlords.

Read more about rent arrears.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Government’s annual housing benefit bill rises to £30 billion | LandlordZONE.

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LATEST: Government spending £84m a day on housing benefit for tenants

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The government is expecting to spend and eye-watering £30 billion on housing benefit for tenants this year, DWP minister Will Quince has told parliament.

This figure is £10 billion more than the Office for Budget Responsibility forecast would be needed for 2020/21 before the pandemic struck and reflects the huge financial strain the welfare state is under during Covid.

Quince’s answer came in response to questions from several MPs in parliament who are concerned that rent arrears are building to unsustainable levels.

Conservative MP Bob Blackman (pictured) said that: “The evidence produced by the National Residential Landlords Association and a lot of housing charities demonstrates that rent arrears are growing and growing very fast such that they will probably never be repaid.”

Quince, who is the Parliamentary Under-Secretary of State for the DWP, said Ministers were worried by the problem of mounting rent arrears too but said the government’s huge housing bill and other measures demonstrated it was doing all it could to support struggling tenants on benefits.

He also said the £30 billion excluded the £1 billion spent on raising the Local Housing Allowance threshold to the 30^th percentile, and that landlords and tenants are now able to request that rent is paid direct to a landlord online if ‘financial harm’ is likely.

But as LandlordZONE has reported many times in the past, the Alternative Payment Arrangements or APAs Quince refers to are not as easy to arrange as he claims.

Landlords requesting APAs can face a glacially slow and often unstaffed bureaucracy which is too easily outwitted by tenants intent on pocketing housing benefits payment rather than passing them on to landlords.

Read more about rent arrears.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Government spending £84m a day on housing benefit for tenants | LandlordZONE.

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All social housing residents should be treated with respect and dignity

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Social housing residents will be helped with improving their living conditions through a new government campaign, ‘Make Things Right’, will help residents raise complaints if they are unhappy with their landlord and struggling to get problems resolved, with clear advice on how to progress issues to the Housing Ombudsman if necessary.

The post All social housing residents should be treated with respect and dignity appeared first on Property118.

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EXCLUSIVE: ‘No hope of deadline extension’ for electrical checks ahead of April 1st cut-off

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Landlords and letting agents are likely to have to meet the new Electrical Safety Standards by 1^st April, despite attempts to push back the deadline.

Rented properties must comply with the regulations by the beginning of next month, requiring landlords to have electrical installations inspected and tested by a qualified and competent person, at least every five years.

In December, Propertymark warned the government that the huge task of ensuring all rented homes would comply in time was unlikely and that an “anticipated and widespread failure in compliance” would follow.

Lockdown blamed

It largely blamed the lockdown – slowing work and causing tenants to be reluctant to admit tradespeople, along with a shortage of qualified electricians. However, the trade body says it has had no indication from the government that the deadline will be extended.

The National Residential Landlords Association says its members have also raised concerns about an inconsistent approach to the regulations being adopted by inspectors.

A spokesman tells LandlordZONE: “We have raised this with the government and are expecting the relevant professional and trade bodies to issue guidance to ensure a more consistent approach.”

It says it’s aware of cases where tenants have refused access to properties for landlords to comply with the regulations. “In such cases, landlords should ensure they record where they have attempted to gain access to the property but been refused it by the tenant.”

Timothy Douglas (pictured), Propertymark’s policy and campaigns manager, agrees that it’s important to document all activity relating to arranging, planning and scheduling work relating to compliance with electrical checks.

He adds: “Creating a paper trail of communication between tenants, landlords and electricians will safeguard agents against any enforcement activity where work could not be carried out during the pandemic.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – EXCLUSIVE: ‘No hope of deadline extension’ for electrical checks ahead of April 1st cut-off | LandlordZONE.

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Property values: What does 2021 have in store for landlords?

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Despite a recent slowdown, house prices are predicted to carry on rising throughout 2021, landlords will be relieved to hear.

The latest figures from the Halifax and other expert’s forecasts indicate that house prices are set to remain steady in 2021.

Last week’s budget, with its extension to the stamp duty holiday and other measures to support  mortgage borrowers, means the property market looks set for another mini-boost, at least in the short-term.

The Halifax figures showed a stalling of prices in the first two months of the year, but that was before Rishi Sunak’s budget last week when he delighted those buyers with purchases pending, taking the pressure off from completing before the 31^st of March.

A buyer of a £500,000 property will save £15,000 if the sales goes through before the stamp duty concession ends.

Pause

There was a definite pause in the upward trend in prices in the second half of last year, when prices rose by an average of 5.2% in the year to the end of February.

The Office of Budget Responsibility (OBR) had predicted a fall (mini-crash), a fall off of the stamp duty holiday “cliff-edge”, of 8.3% but this was before the Chancellor announced his extension and his further measures to  taper the end of the holiday.

Russell Galley, Managing Director, Halifax (pictured), says: “Having enjoyed an extremely strong period of activity in the second half of last year, the housing market continued its softer start to 2021, with average prices down very slightly (-0.1%) compared to January.

“However, with annual house price inflation currently at +5.2%, property values remain comfortably higher than 12 months ago, when February was the last full month before lockdown.

“The housing market has been at something of a crossroads at the start of this year, with upcoming events key to determining the path of activity and prices over the next few months. The government’s decision to extend the stamp duty holiday – one of the main drivers of demand from home movers during the pandemic – has removed a great deal of uncertainty for buyers with transactions yet to complete.”

Stabilised market

Forecasts put out by Capital Economics, The OBR and Knight Frank also support the view that the budget measures have stabilised the market in the sort-term with a forecast of an 8.1% rise above a year ago, coming up to the stamp duty holiday deadline, but then easing down again gradually towards the year-end.

With buy-to-let rental property still in high demand – properties selling as soon as they come onto the market in many locations – and a move out of city centres towards urban and rural living, some properties are selling at above average prices.

It seems that property is still a relatively safe and sensible place to have your money, especially when compared to other forms of investment.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Property values: What does 2021 have in store for landlords? | LandlordZONE.

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