Majority of landlords taking action ahead of tax relief changes

Majority of landlords taking action ahead of tax relief changes
It’s clear that landlords’ understanding of the changes has improved and that more landlords are developing a clear strategy to address the impact of the changes.

Paragon Mortgages has seen a "modest improvement" in optimism among landlords as they begin to take action ahead of changes to tax relief.

22% of landlords surveyed are now more optimistic as they come to terms with the impending changes to tax relief and an increase in stamp duty.

While the majority (65%) of landlords report no change in sentiment, 12% still said that, compared with three months ago, they are now more pessimistic, down from 18% three months ago.

This coincides with rising levels of awareness about the implications of the tax relief changes, with the policy due to be phased in from April 2017, as 58% of landlords reported having already taken, or are making plans to take, action ahead of time.


The most commonly reported actions have been to increase the rent charged to cover some or all of the increased cost (24%), to maintain their current properties but not buy any more (21%) and to sell some of their properties and not buy any more (16%).

As a result, buying intentions, which remain some way off their peak, are slightly improving, with 13% expecting to purchase buy-to-let property in the next quarter, up from 11% in Q3. While a higher proportion (17%) of landlords expect to sell, this is down from 21% three months ago.

As is expected in the current landscape, tenant demand remains high, with 94% of landlords describing the market as stable or growing, and fewer than one in 30 suggesting a decline. Tenant demand continues to impact average void periods, which remain unchanged at 2.7 weeks.

John Heron, Managing Director, Paragon Mortgages, said: “We’ve reached a critical time for landlords looking to plan ahead and this is reflected in the Q4 report. It’s clear that landlords’ understanding of the changes has improved and that more landlords are developing a clear strategy to address the impact of the changes.

“However, despite increasing optimism, we must remain cautious. The changes have not started to be implemented yet and the full impact will not be felt for many years. Whilst it is predictable that landlords will seek to increase rents in response to higher costs this clearly will not be good news for tenants, particularly those that are already struggling to save for a deposit.”

Join our mailing list:

Leave a comment



Our Next Event

Buy-to-Let Roadshow July 2017

Buy-to-Let Roadshow July 2017

Newcastle - 18/07/2017

Bolton - 19/07/2017

Derby - 20/07/2017

Reading - 21/07/2017

Register now

Latest Comments

SecomTech
SecomTech 22 Jun 2017

AT Last...This was discussed years ago and there was a move towards landlords registering their bad tenants on a database..(can't remember where) It seems a logical step though our leaders will probably...

view article
Bertrand
Bertrand 02 Jun 2017

How about the Welsh Govt introducing a scheme to protect landlords against "rogue" tenants who are then taken to court for criminal damage to the properties they trash. Pretty unlikely I suspect and politically...

view article
AmberMorris
AmberMorris 25 May 2017

"Please don't pick a novelty tune-playing doorbell. They're not 'fun'. They're stupid." Laughed a lot to this. It's actually true, though.

view article
Oliver Conway
Oliver Conway 18 May 2017

Making a neat inventory is a good idea, but if the seller is not willing to provide it, can the buyer demand it?

view article
Bertrand
Bertrand 17 May 2017

First step to nationalisation of the private rented sector IMHO. Nanny state poking their noses into things yet again. I object, as a decent landlord, sometimes having to deal with some pretty awful tenants,...

view article
Izzy
Izzy 16 May 2017

This is such a great a post. I love the detail you've gone into. It's a very useful article for helping those who are looking at deciding which sector they would like to go into! When I first started investing...

view article
paul burnham
paul burnham 30 Apr 2017

Jeremy Corbyn's pledge that a Labour government would build 500,000 new council houses must electrify the general election campaign. Reliance on markets and the profit motive has brought huge housing-related...

view article
CommercialTrust
CommercialTrust 28 Apr 2017

Sadiq Khan?s announcement of an online database of landlords and letting agents who have been convicted of housing offences, appears on face value to be a variation of the already implemented Database

view article
warren
warren 26 Apr 2017

You're very welcome Mary! Glad you enjoyed them :)

view article
Mary Ward
Mary Ward 26 Apr 2017

Thank you for the wonderful ideas. First impressions can make or break a deal. It's sadly that many homeowners drop the kerb to create an off-street parking space.

view article
Tony Gimple
Tony Gimple 14 Apr 2017

I'm not at all surprised that so many landlords are still confused about what the tax changes really mean and how it will affect them. In particular, the blind rush to incorporation is leaving landlords...

view article
MH
MH 13 Apr 2017

You are right that the bank holidays are going to be spoiled in looking for the properties. But people who want to sell their property and looking for the better relocation, they can get benefits of this...

view article

Related stories

More articles from Landlords

Buy-to-Let Roadshow
July 2017

18th-21st July

4 days
7 specialists
4 locations
Free to attend

Click here to register now