Landlords point to eviction reform to boost buy to let investment

0:06 AM, 24th July 2024, About 4 months ago 8

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Landlords say that a more efficient eviction system is the best way to encourage increased investment in the buy to let sector, research reveals.

According to mortgage market specialist Pegasus Insight, it found that 64% of landlords prioritise streamlining the eviction process, eclipsing even lower taxes as a motivator.

A reduction in Capital Gains Tax, the reintroduction of tax relief on mortgage interest payments, and removal of the 3% Stamp Duty surcharge were also cited by more than 60% of landlords as key factors.

Also, 59% of landlords expressed interest in investing if BTL mortgage rates dipped below 4%, while 52% sought greater regulatory stability.

These preferences were echoed by landlords planning to sell within the next year, who placed an even stronger emphasis on eviction reform at 71%.

‘Valuable insight into landlords’ concerns’

Bethan Cooke, a director of Pegasus Insight, said: “This research provides valuable insight into landlords’ concerns.

“The fact that a larger proportion of landlords point to a more efficient evictions process as a greater spur to investment than a lower tax regime demonstrates how worried they are about the removal of Section 21 ‘no-fault’ evictions in the Renters’ Rights Bill, which the government has confirmed it will introduce within the next year.

“It is no secret that there is a massive backlog in processing evictions through the legal system, and industry bodies have warned that banning Section 21 could overwhelm the courts and prove the final nail in the coffin for some landlords.”

She added: “Our research demonstrates that, whatever form the new Bill takes, it must be considered carefully to take into account landlords’ concerns as well as tenants’, to prevent a decline in rental property numbers, and an accompanying rise in rents.”

Influential factor in encouraging investment

The research found that a drop in house prices was not seen as an influential factor in encouraging investment, with just 16% of all landlords identifying this as important.

Ms Cooke said: “When it comes to taxes, these results confirm that, if the government wants to encourage more investment in the private rented sector which plays a key role in providing homes for almost 20% of UK households.

“It would do well to consider reviewing the punitive tax regime which has been imposed on landlords in recent years, rather than increasing CGT or tightening the screw on limited company landlords, which many fear.”

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Tags: Buy to let, CGT, evictions, Landlords, mortgage interest, Pegasus Insight, Property investment, Rental market, renters rights bill, Stamp duty, Tax

Comments

Cider Drinker

9:23 AM, 24th July 2024, About 4 months ago

The ability to remove a ‘bad’ tenant would deliver a welcome boost to those looking to rent privately. It would allow the property to become available to a new tenant. Perhaps a family that is currently consigned to the housing scrap heap known as temporary accommodation.

Void periods (between tenants) are extremely wasteful and virtually impossible to avoid. Without a KNOWN date for when the outgoing tenants will move, landlords cannot plan to recover the property, to carry out essential maintenance or to employ tradespeople.

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TheMaluka

9:56 AM, 24th July 2024, About 4 months ago

Let us revert to the 1988 act, which worked well for many years. Repeal all the nonsense legislation introduced since 2016.

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PETER harvey

10:50 AM, 24th July 2024, About 4 months ago

the eviction process is far too long allowing any rent arrears and malicious damage to continue when it could be stopped with quicker evictions. all these long evictions do (in my own case 2 years) is give councils longer time before they have to address the problems namely lack of accommodation. i cannot understand why a landlord cannot use a certified private bailiff which would be far quicker than a court bailiff.

in my experience all private landlords want is the rent paid and the place looked after. you will find that tenants who are evicted for either rent arrears or damage just go from one property to another continuing the same behaviours. there is also the housing benefit issue where tenants who have been in arrears before and not paid the benefit for rent should have the rent paid direct on any new letting. in some cases it is just asking for trouble when it is paid direct to the tenants and is really a fraud which tax payers have to bear

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Downsize Government

10:59 AM, 24th July 2024, About 4 months ago

Spent over a year trying to evict a tenant not paying rent. Luckily I have rental guarantee otherwise I wouldnt take the risk. My relatives overseas can't believe it takes more than a few weeks. This is not normal.

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Philip Westlake

12:01 PM, 24th July 2024, About 4 months ago

Not paying rent is theft, pure and simple you would not go into a car dealership and drive the car out without paying, we have this dangerous scenario now where governments are turning a blind eye to non payment, stores are getting looted and the message is it's OK to not pay.

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Leicester Landlord

15:54 PM, 24th July 2024, About 4 months ago

There is an easy solution in preventing the courts from becoming overwhelmed. If the landlord can prove the tenant has not paid rent for two months or longer, then the eviction notice should automatically be granted without going to court. Such an easy paper exercise, but so hard for the Government and courts to grasp.

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Ofer Moses

18:13 PM, 24th July 2024, About 4 months ago

Reply to the comment left by Leicester Landlord at 24/07/2024 - 15:54
Charity groups and the government are intent on keeping tenants in their homes (Landlords property), regardless of rent arrears etc

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20:30 PM, 24th July 2024, About 4 months ago

It puts the rent up for tenants who pay. They subsidise bad tenants. I'd be livid about this if I was a tenant

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Landlords point to eviction reform to boost buy to let investment

‘Valuable insight into landlords’ concerns’