Investment in Buy to Let Property takes a significant hit

Wednesday, February 28th, 2018

In a recent report by IMLA (Intermediary Mortgage Lenders Association) it was found that overall net investment in buy to let property has fallen by 80% between 2015 and 2017, in the main due to what they believe has been “excessive regulatory intervention on the buy to let sector”.**

This research has jolted IMLA to request that any further policy interventions on the UK’s Private Rented Sector are delayed as this reduction is worse than that felt after the financial crisis 10 years ago.

£290 Billion Invested to Meet Rising Demand**

The report is not all unwelcome news as it also shows the positive effect, that between 2000 and 2017 buy to let landlords in the UK invested almost £290 billion into the sector, meeting rising demand from tenants. However, the data indicates that ‘real’ rents have in fact fallen 4.4% across the UK during the same period.

Are Tax and Regulations a Deterrent?

Furthermore, the IMLA report shows that new tax and regulatory measures introduced in the last couple of years have certainly deterred some landlords from expanding their portfolios and prompted others to sell their investment property and exit the market. As a result of tax changes alone, more than 21% of landlords have said they plan to reduce the size of their portfolios in the near future. **

Professional Mortgage Advice for Landlords

We at Caboodle Finance believe that an aspect of this slump is due to a lack of understanding in the changes, which can only be alleviated by landlords consulting with a professional mortgage broker and their accountant. Although some landlords are taking appropriate and professional advice, it is likely many are not and simply choosing to exit the buy to let market as an ‘easy option’.

In a recent speech, Kate Davies, Executive Director at IMLA, urged the government to reassess the impact of the recent regulatory changes to buy to let investment and allow a period of policy consolidation.

Great Opportunities Still Exist

However, we believe the buy to let mortgage market still offers some great opportunities as tenant demand is high and there are still many products available for new and existing landlords on both personal and limited company ownership.

Finding the most suitable Buy to Let Mortgage for You

Finding the most suitable buy to let mortgage may not be as straightforward though and using a professional mortgage broker to source and process the mortgage needed, in conjunction with the correct advice from an accountant, may prove to be the best decision any landlord could make.

The team here at Caboodle Finance of Sutton Coldfield, Birmingham are available to help. For more information, call 0121 308 9114 today or alternatively just click HERE to email us.


** Source – IMLA : ‘Buy to let-Under Pressure’ (06/02/18)


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Caboodle Financial Services Ltd, registered in England at Mere Green House, 46-48 Mere Green Road, Sutton Coldfield, West Midlands B75 5BT (number 08044670).
Caboodle Financial Services Ltd is an appointed representative of PRIMIS Mortgage Network (PRIMIS), a trading name of Advance Mortgage Funding Ltd which is authorised and regulated by the Financial Conduct Authority. PRIMIS is only responsible for the service and quality of advice provided to you in relation to mortgages, protection insurance and general insurance products. Any other product or service offered by Caboodle Financial Services Ltd may not be the responsibility of PRIMIS and may also not be subject to regulation by the Financial Conduct Authority. The Financial Conduct Authority does not regulate some forms of Buy to Let.

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