Summer Budget 2015 – Landlords Reactions

Reply to the comment left by "BTL INVESTOR SCOTLAND" at "19/08/2015 - 21:13":

They certainly want the big boys in!

http://www.echarris.com/pdf/pushing%20the%20boundaries.pdf

This research indicates that Build to Rent PRS developments do
have much wider potential across England than perhaps previously
thought. Although the distribution of viability is skewed towards
London and the South East it is not exclusive to these areas. There
is a large proportion of the geographic market in England that could
potentially be unlocked through creating viability by adopting specific
optimisation measures, whilst still robustly testing the investment case.

Reply to the comment left by "BTL INVESTOR SCOTLAND" at "19/08/2015 - 21:13":

http://www.gov.uk/government/speeches/private-rented-sector
http://www.gov.uk/government/news/next-steps-for-10-billion-housing-guarantees

The guarantees will support investors in a variety of ways. For example:

An investor wants to build a block of 100 flats that they will then offer for private rent. The value of the built flats will be £20 million. They can apply to the guarantee scheme for up to £16 million, or 80% of the end value.

To qualify, the homes must not yet have started on site, be well-designed and commercially viable with a plan for rental management, and meet the scheme’s stated criteria. If the application is successful and the scheme goes ahead as planned, the government will guarantee their debt until it is repaid.

Came across this article from 2011.

http://www.dailymail.co.uk/money/mortgageshome/article-1721350/Buy-to-let-replacing-first-time-buyers.html

It does suggest that the attitude of lenders has been a significant factor in the growth of the buy to let market. This is why the Government should await proposals from the Bank of England on lending criteria etc before deciding if new tax measures are required.

Reply to the comment left by "Connie Cheuk" at "19/08/2015 - 19:06":

Thanks for the last bit of my puzzle, Connie. I've copied what you wrote into the annexe of my submission.
It'll be interesting to see what goes on tomorrow now at the Treasury. Whatever happens, we need to keep calm and keep fighting. This is a battle and we must keep up a steady momentum and keep building on it - with all the methods we have - trying to get the MPs to actually listen and/or read our clear arguments; ditto with the Press... I'm hoping we don't get some stupid announcement from the RLA or NLA saying they've won us a marvellous meaningless concession. The more I read about this the more it is lunacy. According to the research, not only the economists here think it's mad; it would also set us apart as probably the only advanced country in the world who has done this. Other countries actually support landlords and encourage the sector - e.g. through allowing for depreciation of rental property and other kinds of tax advantages. Ironically, the Government should be making things easier for us at the exact point they're trying to ruin us. We have to keep sight of the fact that the whole thing is outrageous and not be thrown by their double-speak about an effing 'generous tax relief.' They don't see finance costs as that in other countries.

Here is another article showing the media's views on how buy to let investors impact on first time buyers.

http://www.dailymail.co.uk/news/article-2910221/Mortgages-time-buyers-falls-seven-month-low-needed-borrow-125-000-property-ladder.html

Reply to the comment left by "KATHY MILLER" at "19/08/2015 - 21:57":

Hi Kathy.
From what I've read recently, these institutional schemes have been tried in the past and haven't worked well. Apparently tenants prefer us private landlords to these faceless institutions. Not everyone wants to live in an identical box to others either. Also, they can be expensive to both buy and to rent. And apparently often institutions don't want to get into the rental market because the margins are so poor.... And the Government is seeing them as a panacea (I wonder why???)

Reply to the comment left by "Ros ." at "19/08/2015 - 22:20":

Yes I agree Ros

I wouldnt want to rent one and pay maintenance and ground rent to them.

Reply to the comment left by "BTL INVESTOR SCOTLAND" at "19/08/2015 - 21:50":

Thanks

Could have increased house prices by 13000 frm 1996 to 2007

Reply to the comment left by "KATHY MILLER" at "19/08/2015 - 21:13":

Thanks Kathy

This is very useful.

I don’t mean the introductory paragraph which talks of “tax relief for interest payments on buy-to-let mortgages (a handout that those with owner-occupier mortgages do not receive)” and “level the playing field between owner-occupiers and buy-to-let landlords in accessing mortgage finance, helping to solve Britain’s affordability crisis.”

(BTW, I thought the Chancellor was claiming to level the playing field as regards tax “relief” not as regards access to finance.)

This made it sound as if the Economist’s writer had fallen for the Treasury propaganda...

The useful stuff comes later, as you posted before. Only 7% of the 150% rise in property prices between 1996 and 2007 was due to increased lending to landlords, according to a report published in 2007 by the National Housing and Planning Advice Unit, a British quango:
http://webarchive.nationalarchives.gov.uk/20120919132719/http://www.communities.gov.uk/documents/507390/pdf/684943.pdf

On page 18 there is a graph showing rise in prices between 1996 and the summer of 2007, when the market peaked. It shows the actual rise compared to what they estimate would have happened if there were no BTL mortgage lending. The gap at the peak was 7.4%.

On page 20 it states “For instance, since 1996Q3 house prices increased in real terms by 150 per cent [up to 2007Q2]”.

My experience was that landlords stopped buying in 2006 because of the high interest rates. To survive them my partner and I sold 4 properties in the first half of 2007, but they were all to owner-occupiers, including two FTB’s. At the peak of the market, it was not landlords who were forcing prices up, in my experience.

What was the experience of other members of the forum? Were you buying, selling or holding in 2007? If selling, to whom? If buying, from whom?

Reply to the comment left by "BTL INVESTOR SCOTLAND" at "19/08/2015 - 21:13":

Hi BTL I S

I note that the expert Task Force does not include any landlord associations, ominously.