The changes impacting buy-to-landlords, including an increase in stamp duty for additional homes and the changes to mortgage interest tax relief next year, will mean a move towards more professional and less ‘dinner party’ landlords active in the private rental sector.
That was the view of Adrian Moloney of One Savings Bank, speaking at today’s Financial Services Expo (FSE) London exhibition, as part of an industry panel debate covering a wide range of issues.
When asked about the changing nature of buy-to-let and the landlords that are active within the sector, Malone said: “We are seeing a move towards a more professional sector and we’re going to see less of the ‘dinner party’ landlord. This is very much an era of professionalism and I don’t think that’s necessarily a bad thing for the private rental sector.”
Gary Salter of Nationwide Building Society agreed that the recent (and forthcoming) changes would have implications for individual landlords. “We will see a change,” he said. “This is the direction of travel we are going in – we moved to a 145% rental calculation earlier this year. Lenders will need to be much more prudent.”
However, Maloney was less keen on seeing the changes to mortgage interest tax relief – to be introduced from April next year – make it to legislation. “My hope is that the Chancellor will change the tax rules for buy-to-let landlords in the Autumn Statement, but that’s probably not going to happen,” he said.
When also asked what action they would like to see Philip Hammond take in his first Autumn Statement in November, John Coffield of Paradigm Mortgage Services suggested changes to stamp duty land tax, particularly in London and the South East, in order to help stimulate the market. He argued that estate agents are not seeing enough properties come to market because people are put off by the costs of moving.
Maloney agreed that stamp duty could be one area to be changed. “I would like to see some help for home movers,” he said, “...perhaps we could relax stamp duty in that area.”
Salter said Hammond should send “a clear message on the direction that he’s going to go in” and that he should provide further encouragement for first-time buyers. Jason Berry of Uinsure was hoping that Insurance Premium Tax would be left alone.
Further details on Financial Services Expo London are available at: http://www.financialservicesexpo.co.uk/london