Buy-to-let purchases increase in 2017 | Romans Property News

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25 Aug 2017

Buy-to-let purchases increase as extra taxes fail to put off investors

Author: Michael Cook

Whilst homeowners pause to think, buy-to-let investors remain confident in the property market. Despite a number of changes in recent years to the taxes imposed on buy-to-let landlords, investors do not seem to have been put off when it comes to buying property. In fact, new figures from HMRC have shown that the number of investment property transactions has increased by 3% in the last quarter.

Michael Cook, Romans Lettings Managing Director elaborates; “This figure from HMRC backs up what our own internal data is showing - in the first half of 2017, 1 in 4 buyers who registered with Romans was a buy-to-let investor.

It doesn’t come as a surprise as many towns around the South East will soon benefit from the opening of Cross Rail and a number of town regeneration projects which will no doubt increase the demand for rental property.”

Despite the fears that the additional three percent stamp duty imposed on those buying a second home and the reduction in mortgage tax relief for landlords would dampen confidence in the buy-to-let market, a survey undertaken by Direct Line for Business found that over a third of landlords felt positive that house prices would increase and over a quarter felt the same about rental prices.

The same survey also reported that contrary to popular belief, 28% of landlords felt Brexit and the triggering of Article 50 would have a positive effect on the rental property market. Confidence from investors remains high as property continues to deliver exceptional returns, particularly in comparison with other investment options such as stocks and shares.

The real concern for landlords is the increased risk of prosecution and fines, 40% of landlords surveyed by Direct Line for Business admitted to being nervous about failing to comply with the increasing amounts of complex legislation landlords must adhere to.   

Michael adds: “Investors appear to have realised that the substantial returns on offer in the property market far outweigh the initial costs, including an increased stamp duty tariff.

With tenant demand remaining extremely high across the South East and buy-to-let mortgage interest rates as low as 1.7%, conditions are perfect for landlords looking to make the most of their property.

The increased concern around prosecution and fines has led to an increase in landlords utilising our fully managed service, a trend seen across the country with the NLA reporting a 7% increase in the number of landlords using a letting agent.”

For tailored advice on investing in property contact Romans on 01344 985 870 or visit romans.co.uk.

 

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