Landlords’ Confidence - Gone For Good?

Quite pain-shakingly, the London property market is combusting, fewer properties are being let, and exactly 82 billion GBP is being stuck in reversal, courtesy of the first law-induced lockdown in spring. More than 350,000 buyers have had their purchases slashed, with the Bank of England predicting a sharp 16% decrease in house prices as a whole. Sure, this may cause alarm bells to ring, however for landlords, the situation is far direr. The National Landlords Association Survey dug deeply into the thoughts of those who rent out properties and saw a repetitive pattern - landlords who were once eagerly letting are now dismissing this idea and instead, buying out their own (what would have been) future investments. The National Residential Landlords Association (NRLA) declares that the gap between landlords who were coveting to rent out flats and are now seeking to buy said properties has increased by 17%. The motive behind this? Low landlord confidence, with London being the primary city in which this occurs, is unfurling. The reason for that?
Untimely rental payments, alterations of tax brackets, all in combination with the current Covid surge. The NRLA sympathizes with this statement and adds that only 13% of landlords have their eyes set on buying at least one prized piece of real estate to rent out to tenants, in comparison to 18% in 2019.

Tax adjustments which generate spiteful bundled up costs are the main factors behind the dip in landlord confidence; David Smith, who was policy director for the Residential Landlords Association (RLA) until the association merged with the National Landlords Association (NLA), shares how the association themselves attempted to halt the tax increase on landlords and were left with a premonition that the strategy is all backward and mismanaged - he says, “the statistical figures regarding rent changes were more than correct in proving that.” David Smith further spurts out that the tax increase signaled for landlords to run from the market, damage their investments, and make it horribly strenuous for tenants to find future properties that suit their exact demands. Ultimately, the secretive solution to ending the pitfall of landlord uncertainty and once again, enabling landlords to rent out a fruitful number of stark apartments and country villas alike, lies in the faith of political parties; “Whoever is in government following the election needs to completely change the approach and start to support good landlords to encourage them to invest to meet the rising demand for rented housing.”

A few ways of feeling safer as a landlord:

1.Following the Coronavirus outbreak, landlords can claim their three-month mortgage holidays [certain conditions apply];
2. If tenants have any difficulties in repaying their rent, although the eviction notices were banned, landlords can and should start a dialogue with their tenants. Tenants can receive support from the government and, if they correctly manage their finances, can and should pay landlords on time.
3. Green Homes Grant (England only). Landlords can benefit from a new 2bn grant, which started from September 2020 by applying vouchers to reduce up to two-thirds of the energy efficiency costs up to £5,000.
4. Finally, the second payment on account towards income taxes were automatically deferred until the end of January 2021. This was automatic and does not need to be done in person.

I hope this article finds you well :)

More info on www.gov.uk/government/publications/