Summer Budget 2015 – Landlords Reactions

Reply to the comment left by "Appalled Landlord" at "31/07/2015 - 22:33":

All Belvioir franchisees are already signed up to receive the Property118 weekly Newsletter so no need to contact them, but it wouldn't hurt.

Neil Patterson can provide a spreadsheet with all of their email addresses. npatterson@property118.com - might have to wait until Monday though.

It might motivate them further to take action if they receive the message from multiple sources.
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Reply to the comment left by "BTL INVESTOR SCOTLAND" at "31/07/2015 - 22:35":

Thanks again for the inspiration - I have sent the following Tweets

Home prices set to fall as landlords prepare to sell up – prevent it by signing petition https://t.co/YK2Dixwo7d

— Mark Alexander (@iAmALandlord) August 1, 2015

Homeless numbers set to rise as landlords prepare to sell up – stop it now by signing petition https://t.co/YK2Dixwo7d

— Mark Alexander (@iAmALandlord) August 1, 2015

Attention landlords who are basic rate tax payers – this tax change could affect you! http://t.co/2wlPlkuH1h

— Mark Alexander (@iAmALandlord) August 1, 2015

Lack of consultation on tax change concerns landlords – sign petition to ensure Parliamentary debate. https://t.co/YK2Dixwo7d

— Mark Alexander (@iAmALandlord) August 1, 2015

Call to Action – Stop Osborne destroying rented sector. https://t.co/YK2Dixwo7d #landlords

— Mark Alexander (@iAmALandlord) August 1, 2015

Reply to the comment left by "Martin Silman" at "01/08/2015 - 10:41":

Thanks for posting Martin and being open to discussion.

Regarding this;

"I think the distinction is that if you are a limited company then you are treated as a limited company for tax purposes whereas if you are handling your tax affairs as a private individual, then you are an investor and will be treated differently."

There is a big middle ground between the two positions for professional landlords, it is akin to being a sole trader.

However, like you, I won't be badly affected by this. Competition will be hit, rents will rise and there will be buying opportunities.

Unlike you though, I don't represent a landlord group.

This is an attack on our profession and the anti landlord brigade will pick up on your musings and use it against us all.

The decent thing to do would be to remove your comment, just link to the petition and let your readers make up their own minds.

I would also like to give you Kudos for predicting this in your earlier article. (I also saw the way the wind was blowing but didn't expect it on this scale).

The terminology used by Martin Silman at 118 forum, seems to suggest that, he is common individual as opposed to a professional entity.

I would not touch his advice with barge pole.

Reply to the comment left by "Michael Barnes" at "01/08/2015 - 09:28":

But landlords are not borrowing for personal investment, in the sense that I might borrow £1000 to invest in shares in the hope that it will make me more than it costs in interest. I wouldn't expect tax relief on that. Landlords are borrowing, like any other small business, to purchase their stock-in-trade, ie houses, in the same way that a car hire firm might borrow to buy its cars for hire. We are running a business, which for many is our livelihood.

Reply to the comment left by "Martin Silman" at "01/08/2015 - 10:41":

Martin

It was very brave of you to post here following the reaction you received as a result of your memo on the Portsmouth and District Landlords Association website.

Perhaps you didn't realise that we have 200,000 subscribers and that you insulted .... in your words .... "the majority" by suggesting their financing strategies were less than prudent. That was a bad move in my opinion. Property118 advocate very similar levels of stress testing as you do. Nevertheless, many of the landlords here, even those implementing those prudent stress tests, face financial oblivion if these proposals proceed.

Perhaps you would consider a complete re-write of your article? Maybe just link to the spreadsheet (see point one of the opening article on this thread) and allow your members to see for themselves what the effects on their finances will be.

Perhaps you should link to the petition so that your members can decide for themselves whether or not they should sign it?
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Reply to the comment left by "Martin Silman" at "01/08/2015 - 10:41":

A further thought for you Martin .....

Do you think your current stance will encourage or discourage more landlords in Portsmouth to join PADLA?

You have seen the outrage displayed by landlords who are aware of the implications of the Budget proposals, many more in your area will be unaware. When they find out, and seek help and advice from PADLA do you think they will want to join your Association based on your current views?

I actively encourage landlords to join and be an active part of their local Landlord Association. In fact, if you search Google for "Landlords Association - A list of them All" you will be redirected back to Property118. You will find a link to your association there and also an explanation from me why landlords ought to be a member of at least one landlords association.

I am sure you would be better placed to lobby for landlords in your area, e.g. if your local authority was to introduce Newham style Selective Licensing. You need strength in numbers for this. If you merely accept the world is unfair then you and your members will be walked all over.

Finally, I would like to point out that Property118 is not your competitor. Many of our Members are also members of landlords associations as a result of advice provided by Property118.

Our mission statement is a very simple one "to facilitate the sharing of best practice".

PLEASE reconsider your stance.
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Reply to the comment left by "Mark Alexander" at "01/08/2015 - 12:00":

Mark I can only applaud you for the words you chose when responding to Martin Silman. I would not consider joining any Landlords Association that was represented by someone that had the thought process he has. I am afraid I would have put it more bluntly than you.

Whether or not Martin thinks the tax is fair on Landlords or not, the potential outcomes of the change are horrendous. It will not just be rents going up (the general feeling is 30% over the next 5 years from the people I speak to), but the number of evictions will probably be higher than any time in recent history.

In our local city budgets have been slashed by 50% for B&B accommodation and yet it's at the National highest since 2008. So whether Martin thinks raising points is just 'griping' or not, the lack of concern is plain irresponsible.

Of perhaps he is very low geared and it's just the thought of rent increases that he sees as attractive.

Reply to the comment left by "Martin Silman" at "01/08/2015 - 10:41":

Martin,
I've been renting out property for 28 years and have always been able to claim all of my interest as an expense, my very prudent business model would never have conceived that an "operating business expense" such as the interest that I pay my lender would ever be disallowed, let alone paying tax on no profit. I have 38 properties and think that I run an extremely good ship. I have huge business loans as property is all about working safely with finance, your property portfolio is not working correctly if you don't use gearing. I stress test my borrowings for base rates of 5% and more besides to include the inevitable extra overheads that always crop up. If this new BTL tax proposal, loss of wear and tear allowance and the unfair method of how profit is to be derived and taxed was only applied to new finance on new BTL's then I would consider that to be fair. I think that even then it would be a grey day for the British property market, tenants and a host of other spin off business. The fact that it is to be applied retrospectively is just an attack on the landlords wealth, their business, their pension and their livelihood. It's theft!
You state that we should not gripe about taxes, I hear no one griping about taxes, just injustice. For the very rich this extra theft may be palatable but for a lot of landlords who have done nothing wrong it will force a sale. The tools of the trade for Mr Osborne are rates of tax (Tax based on profit) and Bank base rates whether or not he is in charge of them. I make allowances for both of those scenarios. Supposing you got planning permission to build your dream house, spent £300,000 building it and then got told to knock it down how would you feel about that? That's what portfolio landlords have done built up something that works and invested for a future and retirement only to potentially have it knocked down. Did I do something wrong to someone? Am I a bad person?

Reply to the comment left by "Jim S" at "01/08/2015 - 13:19":

Very well put Jim. I'm in a very similar position to you. I can also handle interest rate rises etc. but would never have planned for this insane and unjust policy. I agree with everything you said. In fact, it's so eloquent it should go in a letter to an MP. We are going to set up a spreadsheet and put on it which MPs have been written to, when, what party they belong to etc. in order not to miss anyone out. Watch this space.