There’s still a bright future ahead for buy-to-let
Andrew Turner is director of buy-to-let brokerage Commercial Trust
On interest rates:
Given the uncertainty of everything Brexit, Trump and North Korea-related, the Bank of England knows it needs to achieve economic harmony as best it can, so a big jump in interest rates is unlikely to happen in the near future.
In the last economic crash, huge numbers of people were forced out of house-building trades. This means that, even if the government could put the structure in place to build, there are not enough people to do the work.
For this reason, housing will continue to be in short supply, house prices will be out of reach to many and rental property will be in demand.
On the 3% stamp duty levy:
Landlords run property investments as a business, just like any other business owner across the UK. A business has to make profit to be worthwhile. If costs to offer a service go up and demand for the service is sustained or heightened, a business will up the cost of the service to its clients.
Buy-to-let is the same.
The government has not helped tenants by increasing stamp duty tax to landlords, they have simply increased the rent bill.
On PRA changes to mortgage affordability calculations:
Lenders have responded swiftly to the changes and there are products on offer that present great solutions for landlords.
It is far better to take a proactive approach so that you are clear on your position. I am very much of the view that what some perceive as a problem is simply a challenge to overcome. My team knows I am always a man with a plan.
On the withdrawal of mortgage interest tax relief:
Profits from buy-to-let may not be the easy-money of days gone by. However, in the long term, bricks and mortar will commonly achieve capital growth. Making profit from rental income is simple accounting.