Buy-to-let 

Landlord ‘scapegoating’ could prompt buy-to-let exodus

Landlord ‘scapegoating’ could prompt buy-to-let exodus

Landlords feel unfairly targeted by the government’s tax changes and many are considering leaving the market, according to research.

A survey by protection provider AXA reveals 40 per cent of landlords believe they will be worse off as a result of the changes - despite the government’s assurances that 82 per cent will not have any additional tax to pay.

Two-thirds of those questioned said they feel stigmatised for running a rental business, with just over half citing government policy as the source of the stigma.

The buy-to-let market has recently been hit by a raft of legislation, including higher rates of stamp duty and the removal of tax relief on mortgage interest.

As a result, almost half of private landlords say they will withdraw from the market by 2020, with 21 per cent planning to sell all their rental properties, ten per cent aiming to reduce their portfolio and seven per cent hoping to switch to commercial property ownership.

Just four per cent of private landlords have a portfolio big enough to be able to give up work and live off the proceeds, with the average UK landlord making £343 rental profit each month, after expenses.

The findings are based on a study of 382 private residential landlords in the United Kingdom conducted by AXA and Taylor Main March 2017.

Gordon Rutherford, head of marketing, AXA Insurance, said: ““We need to remember that few landlords are professional property tycoons: two thirds in the UK are ‘accidental’ landlords. 

“They tend to own just one rental property that they’ve inherited or are finding hard to sell, and they make a modest income once time and expenses are out. 

“They do feel increasingly apprehensive, as we can see from the numbers thinking of withdrawing their properties from the rental market in the coming years.”

Simon Webster, managing director at Kent-based Facts and Figures Financial Planners, commented: “Interest in buy-to let is down significantly. A lot of landlords are considering their future and more will do so as the tax changes bite. There will be a lot of buy-to-let landlords very adversely affected by the tax change.”

simon.allin@ft.com































 

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