Buyers Market?

lisyloo

This explains it.

http://www.simplybusiness.co.uk/knowledge/articles/2017/04/buy-to-let-tax-changes-introduced-by-new-landlord-rules-coming-into-force-6-april-2017/

snickpan

I see. So mortgage debt will no longer be taken into account, you'll just be taxed on your rental income, whether you're massively mortgaged or not.

lisyloo

snickpan wrote: »

I see. So mortgage debt will no longer be taken into account, you'll just be taxed on your rental income, whether you're massively mortgaged or not.

Strictly speaking it's the COST of mortgage debt - but yes in general it's makes things worse for BTL - some scenarios more than others.


That article says that an unintended consequence is higher rents, but misses the point that some markets cannot withstand higher rents and another unintended consequence is BTL landlords selling their properties if the whole proposition is simply not worth it anymore.


Clearly there are a number of factors for example


the amount of debt and the cost of it
the ability of the local market to withstand rises (and whether you want to change tenant or increase the rent on loyal tenants)
whether you are a limited company or not


Some landlords won't be that badly affected, but overall I think it can be seen as negative for BTL generally.

Thrugelmir

snickpan wrote: »

I see. So mortgage debt will no longer be taken into account, you'll just be taxed on your rental income, whether you're massively mortgaged or not.

No quite. The impact is on those that pay higher rate tax on their income.

The-Joker

Property and rents still falling in London.

There are the official figures which are manipulated,

then there are the real numbers that people familiar can easily see, we keep a close eye on the market around here, and there are many places empty for a while, and price keeps going down but they are still vacant.

The-Joker

Everybody loves these programs on TV about nightmare landlords and tenants from hell

its so difficult to get bad tenants out these days, and you know they will trash the place if they are unhappy

many times the landlord pays them hundreds of pounds to leave quietly without taking a hammer to the walls etc

caronoel

The-Joker wrote: »

Property and rents still falling in London.

Not in my personal experience. One of my flats in Clapham Junction has just come up for renewal. The tenants didn't bat an eyelid at a 3% rise.

caronoel

Thrugelmir wrote: »

No quite. The impact is on those that pay higher rate tax on their income.

Not quite.

The tax efficiency is still in place for those buying through a limited company, which my wife and I are looking at currently.

We are also consideringkeeping it out side a company by putting 99% of the ownership into her name, as she is a nontaxpayer, while I pay tax at 45%

In both cases, the tax treatment is far more sensible.

fizio

caronoel wrote: »

Not quite.

The tax efficiency is still in place for those buying through a limited company, which my wife and I are looking at currently.

We are also consideringkeeping it out side a company by putting 99% of the ownership into her name, as she is a nontaxpayer, while I pay tax at 45%

In both cases, the tax treatment is far more sensible.

I have already gone down Ltd company route as the 99% option had implications for mortgage lending

Conrad

The-Joker wrote: »

Everybody loves these programs on TV about nightmare landlords and tenants from hell

its so difficult to get bad tenants out these days, and you know they will trash the place if they are unhappy

many times the landlord pays them hundreds of pounds to leave quietly without taking a hammer to the walls etc

Which is why for example I just spent 6 weeks taking tenant enquiries until I was satisfied I had the right one.
I merely pay an Agent to advertise only, I do everything else myself.


Agents always say I'm uber-fussy, but it's worth the extra effort IMO.


Essentially what I look for is for want of a better word 'meek' quiet sensible rule abiding types.


I see over and again LL's settling for the type of profile that just screams trouble, it's just so unnecessary.


A great way to filter out all the transients, chippy types, roughens and vacant people is to ask them to forward 3 months Bank stats, POID, POA, Payslips and P60 -


I come from a mortgage business background and can spot 'a waster' a fifty paces