Landlords benefitting from buy-to-let tax dash
A flurry of buy-to-let property interest in March pushed total annual returns to 12.2 per cent for existing landlords.
Landlords are feeling the financial boost of the buy-to-let tax dash, according to research from Your Move and Reeds Rains’ latest buy-to-let index.
Rents in England and Wales rose by an average of three percent in the last year, meaning that an average rent is £791 per month.
However, a minority of the nations’ tenants are feeling financially squeezed, with 9.1 per cent of rent in arrears – a jump from 8.8 percent last month.
Taking into account rental income and capital growth but before property-specific costs such as maintenance, the typical landlord in England and Wales has seen as total rise to 12.2 percent in the past 12 months (March 2015 to March 2016).
You may also want to watch:
This is a jump from the 10.7 per cent between February 2015 and February 2016 and is the fastest annual rate of return for existing landlords since November 2014.
In absolute terms, an average landlord returned £22,135 in the last year before any deductions such as mortgage payments or general upkeep.
- 1 Punch Taverns calls time on White Lion pub team
- 2 April 12: Your guide to what can open from Monday when COVID lockdown rules ease
- 3 Major redevelopment underway at listed former offices in St Albans
- 4 Drug users at Telford Court flats face tough police action
- 5 Quarter of tenants become owners at St Albans development
- 6 Police hunt man suspected of breaking into Cathedral collection boxes
- 7 What are the district's best pub gardens to visit from April 12?
- 8 Drive-in cinema arriving at London Luton Airport
- 9 Property Spotlight: An Edwardian home on one of St Albans' most prestigious roads
- 10 The latest court results for the St Albans area
But it hasn’t been good news for all: the recent surge in capital values which has boosted existing landlords has also suppressed rental yields for wannabe landlords and those seeking to grow their property portfolios.
Adrian Gill, director or lettings agents Your Move and Reeds Rains, said: “New tax changes intended to benefit owner-occupiers are now making it more expensive to become a landlord, at least for the time being. Ultimately this will only punish tenants and aspiring first-time buyers. Driving out buy-to-let landlords will reduce the supply leading to lower choice and higher rents for those that can least afford them.
“As the spring market warms up, recent weeks may have been the last of the best deals for those signing a new tenancy. Throughout April, market rents will start to build a gradual but inevitable path, peaking in the autumn.
“Landlords need tenants with sound finances and tenants need a property they can afford. While there is always room for healthy negotiation on rents, both landlords and tenants need each other to reach a deal. For private renting to remain an affordable option and a high-quality home, the answer is more supply and more choice. Good landlords also understand that their interests and the interests of their tenants are aligned – a tenancy should be a mutually beneficial deal.”