Summer Budget 2015 – Landlords Reactions

Reply to the comment left by "Appalled Landlord" at "01/08/2015 - 20:49":

I posted this article onto Crisis' Facebook page. This is exactly what members here have been saying.

I am emailing all 56 branches of Foxtons with this message:

Dear Letting Agent,

As you may know, Chancellor George Osborne has announced a plan to stop individual landlords offsetting our finance costs against rental income. This may have a huge, possibly disastrous, effect on individual landlords – in other words, your clients. And if your clients are adversely affected you will be, too.

Large companies and social landlords will not be treated this way, so the extra tax is unfair and discriminatory.

A vigorous campaign has started counter this measure. Concerned Landlords on a property forum Property118.com has started a petition. There are currently over 5,000 signatures, but we need far more in order for this opposition to be considered in Parliament.

Please sign the petition against this new tax. Please pass this email, or your own version of it, to your employees, Landlords and their tenants so they can sign it, too.

Please circulate far and wide, to include your friends, family, homeowners, trades people, accountants, as the effects are far-reaching and damaging to the Private Rental Sector. Below is the link to the petition, landlords' reactions and an article on the subject. We also have a detailed Q&A on the landlords' forum Property118.com relating to this tax. The forum is free to join and there are many professional members, such as yourself, from the Property industry.

Thank you

Regards
Connie Cheuk
Landlord

https://petition.parliament.uk/petitions/104880

http://www.property118.com/budget-2015-landlords-reactions/

City A M http://www.cityam.com/220861/bashing-buy-let-landlords-will-push-rents-and-hit-uk-economy-hard

Correction - 5,921 signatures. The 1 was my brother, just now.

Reply to the comment left by "Appalled Landlord" at "01/08/2015 - 20:49":

Wow!

Thank you for this one.

Wow again!

Reply to the comment left by "Martin Silman" at "01/08/2015 - 19:11":

OK, now we're in agreement, let's turn it on it's head.

When I first considered the outcome of the tax change it was my opinion that house prices wouldn't fall far. Then I got persuaded by what others were saying that they could spiral downwards. Now I'm firmly back in the mindset that they will only dip slightly.

My thinking behind this is reinforced by the article that Appalling Landlord pointed me to. 57% of new houses go to BTL, so builders will see that market disappear. The other part of their market - 43% must therefore be owner occupiers, so take us out and there is still a fair proportion left.

If Landlords have to sell up then there are still plenty of people to sell to, in fact far more than these figures represent because we need 240,000 new-builds a year (but are only churning out 140,000).

It's the 240,000 that is the market size, not 140,000, or 43% of it. And actually we're behind with the 240k requirement so who knows what we actually need at this moment??

So where does that leave us?

1. Well, the tenants still have a problem because their rents must increase.
2. The builders have a problem because their about to see 57% of their market disappear (that is a sector we really MUST lobby).
3. The builders have a further problem because the market is unstable.
4. They have yet another problem because if we need to sell we can undercut them, and also pay less CGT. We shouldn't need to drop far.
5. The first-time buyers have a problem because house prices are only likely to dip.
6. FTB's will have to stay in rented, which costs them more because rents are higher.
7. Another one for FTB's is that there isn't nearly enough rentals about, driving up rents and house prices again.
8. The Government has a BIG problem - shame that.
9. Local Government and charities will be swamped and demanding that the Chancellor undoes his tomfoolery.
10. Our problems remain in that we may need to dispose of properties but maybe not as much of discount as we had perhaps been assuming.

Or is there something fundamentally wrong with my line of thought?

What I'm trying to say is that this will not cause a house price crash.

Reply to the comment left by "John McKay" at "02/08/2015 - 06:30":

John, I think there is a bigger picture here - what you are looking at is a snapshot in what is part of a fundamental change in the UK housing market (which is why I am less worried by this one element than everyone else on this forum) - I will try and find 10 minutes later and explain my thinking.

Reply to the comment left by "John McKay" at "02/08/2015 - 06:30":

Hi John.
I think there will be big regional variations - the London market will be like another country compared to the South Wales valleys, the north-east etc. I still think that in some areas after houses are repossessed they will fall into disrepair and there won't be enough housing for the very poor and/or unemployed. I suppose many, where they can, will return to their parents' homes, so there will be terrible overcrowding. So overcrowding is another angle we should mention in our communications with housing charities.

My Slogan For Today

Landlords Fight Back Against Budget Tax Plans – Get Involved – Sign the Petition
https://petition.parliament.uk/petitions/104880

Reply to the comment left by "Ros ." at "02/08/2015 - 09:00":

Absolutely Ros, I agree with all the points you make. I was really looking at a general picture of things, and by the sound of it, you agree it.

What falls out of my argument is that for all those tenants (and others) that think this is going to give them a chance to snap up houses at a large discount, they may well be disappointed.

I have posted the following on LinkedIn and my wife on Facebook. Sent to letting agents and financial advisers.
The headline is intended to bring in other groups, including those that think landlords should be hit.
Took me a while because I am a detail person, not a headline writer; my first attempt was a page and a half of A4 (which would have put off most people!)

Landlord-bashing budget proposal could adversely affect most UK adults

The proposals could lead to bankruptcy for landlords, higher rents for tenants, fewer properties available to rent (reducing labour mobility), house price crash, negative equity.

Read the article at http://www.property118.com/restricting-finance-cost-relief-for-individual-landlords-petition/76936/ and if you are worried about the likely impact on the nation, then

1. sign the petition,
2. email your MP and
3. tell your friends and contacts.