Will the government's tax changes discourage BTL investment?

Will the government's tax changes discourage BTL investment?

A new report reveals that 86% of landlords believe the Government's tax changes last year will discourage investment in the buy-to-let sector and ultimately, lead to a shortage of available of rental homes.

The research, conducted by Orchard & Shipman Group – a leading lettings and property management company – also reveals that almost 90% of landlords think the tax hikes will result in higher rents and a quarter of landlords will be selling some, or all of their properties. However, just 18% of landlords said they would pull out of the market all together. (*Source: Orchard & Shipman Group research amongst 500 landlords, January 2016).

The research also reveals that over 90% of landlords believe they should be free to deduct legitimate costs, just like any other business.  More than half of landlords surveyed said they would be raising rents in 2016 to cover the increased financing costs.

Shane Spiers, Chief Executive Officer of Orchard & Shipman Residential comments: “The   Government’s changes to the way buy-to-let investors are taxed will inevitably impact revenue. The shortage of housing, a growing rental market and rising property prices is driving increased demand for rental properties. With these market conditions at play, it’s no surprise that landlords will be putting up rents to supplement their income.  Unfortunately, it is tenants that will feel the brunt of the tax changes.” 


The Government’s ambition to make buy-to-let look less appealing, may yet be thwarted.  Many landlords and property investors are committed and passionate and will do whatever it takes to protect their interests.  Our research shows that the majority of landlords are looking at ways to recover the potential drop in revenue and we are advising landlords on the options available to them. I believe that the buy-to-let market will pull together to ensure it continues to provide much needed accommodation to meet growing tenant demand.”

Orchard & Shipman Group provides property services to landlords across the UK.  The Group has more than 25 years’ experience in delivering services to both the public and private sectors, from a network of offices across England, Scotland and Northern Ireland.

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Latest Comments

MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

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ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

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NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

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Landlady14
Landlady14 01 Mar 2017

You would think so Niraj Shah! My experience only proves that there are varying qualitiers of professional in all aspects of property letting. None of the ones I have dealt with, from letting agents to...

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Mark
Mark 01 Mar 2017

Thanks for this article. Hopefully one day everybody's lifestyle will be eco-sustainable.

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Ben Taylor
Ben Taylor 28 Feb 2017

I was convinced that London was the most expensive!

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Alan Read
Alan Read 28 Feb 2017

Australia are leading the way in this I think. The trouble with Britain is we don't get enough sun to make use of solar power.

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James Powell
James Powell 27 Feb 2017

This is a very good news.

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DanHumphreys
DanHumphreys 27 Feb 2017

It sounds like a good idea. Anything to help the younger generation get a foothold.

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Matt
Matt 20 Feb 2017

Is this fake news?

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Matthew Hollywood
Matthew Hollywood 07 Feb 2017

Matthew Hollywood - Director Mishon Mackay Land & New Homes - Brighton The shortage of New Homes is in part effected by the lack of land sales. Land sales are held back because there is a disparity between...

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CommercialTrust
CommercialTrust 30 Jan 2017

Hi Graham, Would be interesting to see the above figure calculated against an investment via a Lt Company /SPV structure and if the investor found themselves pushed in to the higher tax bracket. Mortgage...

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