Buy to let no longer worth it?

deaston

Miss_Samantha wrote: »

Hi deaston,

I take that you are no longer considering BTL, then.

What makes you think that? Because I agree that people lucky enough to be able to buy a second home should contribute more to the state? I'll definitely still look into BTL, and if it still makes financial sense, I'll do it. And I'll proudly pay my increased SDLT.

_CC_

ognum wrote: »

Clearly the new stamp duty rate on second and subsequent property ownership has no impact on current owners until they come to sell when their purchasers may be limited.

If it's a blanket additional charge on any additional residential property (current wording on the gov.uk docs) then it would also affect landlords looking to move themselves, not just the purchase of any additional BTL properties.

I've never been a fan of BTL as an investment, but if I were a landlord it would be the direction of travel that would worry me just as much as the recent changes. The Treasury clearly has its sights on BTL and additional homes, and the BoE has signaled it as a potential risk for the economy which could mean they introduce measures to restrict BTL mortgage lending.

ACG

I read the first page of this thread, talking about going off topic.

I can not really anyswer your question as it will come down to the figures involved. There are/will still be people making money out there on BTLs. If not from the rental income then from the increase in property prices (Aberdeen being the excpeption apparantly :P).

The other thing to bare in mind is that the market will always react to tax changes, far smarter people than me will come up with ways to still make it count. One of those ways appears to be limited company BTLs. Earlier this year there were maybe 2-3 lenders who were actively marketing those products. Now there are another 2-3 and I know there will be another lender in January/February time which will annouce the launch of Ltd Co BTLs.

The benefit there (appears to be) that you take your income by way of dividend, the first £5k (I think) is tax free. This is one of those times a decent accountant will come in to their own.

Do your research and get the proffesional advice, it could be that the outcome is do not do it but its better to spend £200 on advice rather than risk losing thousands.

For the record, although I am a broker I have had BTLs in the past and the experience I had was that its not worth the hassle. Tenants can be a nightmare. Show any sign of weakness or niceness and they try to take advantage.