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2017 Was Tough for UK Landlords But Interest in Buy-to-Let Remains Strong

2017 was a challenging year for buy-to-let landlords in the UK, thanks to more stringent mortgage lending conditions and the gradual elimination of mortgage interest relief.

Nonetheless, a leading property auctioneer has stated that buy-to-let remains an attractive investment option for many people. 

Although more demanding lending conditions, the stamp duty surcharge of 3% on investors who buy multiple properties, and the phasing out of relief on mortgage interest have made buy-to-let a less appealing proposition, there are signs that landlord interest in the sector remains strong. 

Allsop auctioneer and partner Gary Murphy explained that government policy has done little to reassure buy-to-let investors, with the elimination of tax advantages in addition to the 3% stamp duty increase on second homes that took effect in 2016. 

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Mr. Murphy stated that economic and political uncertainty, in addition to tighter mortgage lending standards, are compelling many landlords to revisit their property portfolios and investment strategies. He said that those who have not yet done this will likely place it at the top of their to-do list for the New Year. 

The new lending stress tests appearing in January will affect all private landlords in the UK, regardless of whether they own one property or several. Both accidental and professional landlords will experience some degree of difficulty. 

Despite this grave certainty, Mr. Murphy insisted that the market for buy-to-let property acquisitions remains strong. 

He said that buy-to-let landlords who wanted to adjust or grow their holdings due to recent tax changes should focus on areas with proven growth and look for opportunities to add value to their portfolios. 

Mr. Murphy added that strong investor value is still evident in the suburbs of London, where demand remains strong and prices are still comparatively affordable. Regional cities are also regarded as a wise investment for 2018, given their potential for strong returns and capital growth. 

Specialists in Construction Insurance


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