As anticipated there has been a furore raised in the private rental sector with the governments changes announced in the most recent budget. The chancellor’s plan aims to raise 600 million pounds over the next few years by restricting tax relief to buy to let investors. A number of investors are already changing their investment plans in relation to freeing up pension cash to invest in the property market. I have also been advised by a number of property management companies that landlords are talking about increasing rents to try and improve yields after the tax changes come into effect. My fear is that the unintended consequences of the governments’ plans will be increased rents, less properties being available for rental and perhaps even an increase in the number of rogue landlords who try and slip through the net as far as declaring rents for tax purposes. I am disappointed that the government did not look at the changes to capital gains tax rules as a means of increasing the money raised from the property market.
My view however, is that property investment is still a worthwhile addition to anybody’s investment portfolio and that the Scottish market in general and Dundee in particular offers a great place to invest. I will keep you advised as trends develop.
Partner – Head of Property