Buy-to-Let the preserve of the wealthy? Not in Oswestry
“Buy-to-let is a key entrepreneurial activity in the UK. It enables those bold enough to take the leap to supplement their income or to move away from employment altogether and become financially free. But such a decision should not be taken lightly and more recently the government has tried to deter would-be landlords in a bid to help first-time buyers onto the property ladder.
“Anyone buying a British property since April this year with the intention of letting it out has had to pay an additional three percent of the purchase price in stamp duty.
“Yes the stamp duty hike will affect the south of the country with property prices spiralling ever higher, but here in Oswestry, you can easily purchase a two bedroom buy-to-let home for under the £125,000 threshold. Making stamp duty just 3%, compared with properties over £250,000 for which you’d pay a whopping 8%.
“Success in the buy-to-let market is reliant on doing the research - know your area and know your rental values. Would-be landlord entrepreneurs – and existing ones – should not be put off by some of the headlines, because even the potential for dents in profits has done little to dampen the appetite of buyers.
“The term ‘safe as houses’ applies well here - property is a tangible asset and people like an investment that they can touch. Rents are going up and demand for rental properties is still strong. It still makes sense - even for someone who isn’t an investment expert - to put their money into property.
“Cuts to the tax relief landlords can claim on mortgage interest payments, due to be phased in from next year, is also expected to have little effect. Apart from the people who buy rental property in cash or inherit property and decide to become landlords, Bank of England research shows that two-thirds of landlords with a buy-to-let mortgage are basic rate tax payers, meaning only a very small minority of landlords on higher rates would be affected by the restrictions.
“As anyone with a basic understanding of economics will be able to work out, where demand is high, supply will follow. Whatever penalties the authorities try to put on landlord investors, the fact remains – there’s a profit to be made on buy-to-let. British house prices have become detached from incomes and demand for rental properties is here to stay.”