I am concerned to note the ever increasing sentiment from both UK and Scottish governments, which is anti the property investor. George Osborne’s recent crackdown on buy to let tax relief and the Scottish government’s constant attacks on the private rented sector, are starting to have an impact. A recent report in the Daily Mail advises that banks are set to launch a new clampdown on buy to let mortgages, with applicants facing stringent financial checks.
I am concerned on the impact on the small private property investor who is looking at a means of supplementing his pension and the unforeseen consequences that this will have on both the rental sector and property market as a whole. I fear that in relation to the rental sector there will be less properties available, leading to increased rents and I am concerned that the new regulations will also encourage some landlords to drop below the radar. Increased rents have an impact on first time buyers, as this reduces their ability to save for a deposit. The lack of property investors also has an impact on the first time sellers and their impact to sell their property and the price that they eventually achieve.
As readers of previous blogs know, I think that property investment forms an important part of a mixed investment portfolio and with the correct advice, can be a very useful addition. I am also concerned that we will see a repeat of the mid to late nineties, with a number of properties languishing on the market because they are of no interest to first time buyers and property investors have been driven away. I will continue to report on trends.
Partner – Head of Property