Summer Budget 2015 – Landlords Reactions

Reply to the comment left by "money manager" at "23/12/2015 - 13:35":

Hi m m

Congratulations on your email trying to wean him off the government’s sophistry. Just one thing though – the new tax liability could exceed the real profit, but it cannot exceed the gross turnover.

Reply to the comment left by "Appalled Landlord" at "23/12/2015 - 14:00":

"but it cannot exceed the gross turnover"; in aggregate with other costs it can.

In repsonse from the Governor of the Bank of England

I was pleased, if a little surprised, to receive the following this afternoon.

"Thank you very much for taking the time to contact me. While decisions on tax fall to the Government, as you note in your email the Bank of England has been monitoring the buy-to-let mortgage market closely. Your description of some of the more salient aspects of the market is welcome, and a valuable contribution to our analysis of the market and the risks it poses to financial stability. This is particularly the case in the context of recently announced changes to taxation arrangements.

The Bank’s remit in this area – through the Financial Policy Committee - is to guard against risks to financial stability. That means our aim with regard to buy to let lending - and other forms of credit - is to ensure that growth is sustainable. In particular, we are conscious of the risk that a build-up of highly indebted buy-to-let landlords could make the housing market – and wider economy – more volatile if those borrowers are forced to sell as prices are falling. To guard against this, we are focussed on the trends around the quantity and type of lending, but also the underwriting standards of lenders, rather than simply on the growth of buy-to-let per se. While to date we have not seen evidence of widespread deterioration in underwriting standards – and in fact, as you observe, some lenders have actually tightened their lending standards - it is important that the quality of lending is kept under review.

As discussed in the most recent Financial Stability Report, the Bank and the Financial Policy Committee are conscious of the growth in buy to let lending in the UK. However, we are also aware that this growth since the financial crisis must be seen in the context of the sharp fall in lending during the crisis, and the ongoing structural shift towards a larger private rental sector. Like you, we view the recently announced changes to taxation as having the potential to affect activity in the buy-to-let sector materially. Our monitoring of buy to let activity will look to identify changes of the sort you describe, and we will share our intelligence with HM Treasury as appropriate.

I can assure you that the Bank will continue to act proportionately in respect of this market and is aided in doing so by contributions like yours.

With best wishes,

Mark Carney

Reply to the comment left by "money manager" at "23/12/2015 - 19:44":

You did well - getting a letter addressed from the man himself. Fingers crossed they'll get their arses into gear and sort out the tw*t at number 11.

Very interesting, and I surmise "Like you, we view the recently announced changes to taxation as having the potential to affect activity in the buy-to-let sector materially." reading between the lines he means by that terminology, he was either not consulted, or did not agree to this crassness.

Call me dull if you like but :

"The Bank’s remit in this area – through the Financial Policy Committee – is to guard against risks to financial stability. That means our aim with regard to buy to let lending – and other forms of credit – is to ensure that growth is sustainable. In particular, we are conscious of the risk that a build-up of highly indebted buy-to-let landlords could make the housing market – and wider economy – more volatile if those borrowers are forced to sell as prices are falling. To guard against this, we are focussed on the trends around the quantity and type of lending, but also the underwriting standards of lenders, rather than simply on the growth of buy-to-let per se. While to date we have not seen evidence of widespread deterioration in underwriting standards – and in fact, as you observe, some lenders have actually tightened their lending standards – it is important that the quality of lending is kept under review."

We will squeeze the life (and cash) out of private LL slowly and surely like a boa constrictor.

and

" However, we are also aware that this growth since the financial crisis must be seen in the context of the sharp fall in lending during the crisis, and the ongoing structural shift towards a larger private rental sector. Like you, we view the recently announced changes to taxation as having the potential to affect activity in the buy-to-let sector materially. Our monitoring of buy to let activity will look to identify changes of the sort you describe, and we will share our intelligence with HM Treasury as appropriate."

If LL survive round one then we will aggressively agitate LL sphincter muscles until they submit and go away ?

Reply to the comment left by "money manager" at "23/12/2015 - 19:44":

Hi MM. May I ask what the content of your letter was to Mark Carney in order I can put his reply in to context.

https://www.landlordtoday.co.uk/breaking-news/2015/12/arla-rents-will-increase-in-2016

Reply to the comment left by "money manager" at "23/12/2015 - 19:44":

Money Manager, this is awesome. Well done.

I would love to get inside George`s Head...

Policy on the hoof or a calculated systematic predetermined plan.

We often never know the real motives of politicians or other prominent public figures until they are out of power. Then the speaking circuit and the memoirs come out and they sometimes reveal more on what made them tick whilst in power

History shows their true colours. We have to wait 30 years for release of cabinet papers. But it will be of course far too late for many by then. Many investors will have to make their life changing decisions in the next few weeks/months ahead. Once a property is sold and profit taken that property is lost once and for all to your business. The kinetic energy built up over the years of planning is all lost in an instant.

Politicians ( many of whom are sociopaths) should be made to take the truth drug whilst actually in power. Then at least we know what we are up against and could fight them on a level playing field.
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