What 2019 Has In Store For Landlords

AFS Team·7 January 2019·4 min read
What 2019 Has In Store For Landlords

What 2019 Has In Store For Landlords

After a year that saw a flurry of regulatory and tax changes, 2019 will offer landlords little respite from more upcoming changes, experts say.

Among the moves to affect the buy to let sector will be new client money rules that will give landlords extra of protection.

There will also be a new housing ombudsman service to be launched this year to help resolve disputes between landlords and tenants, while the Tenant Fees Bill will introduce deposit caps and remove letting agent charges.

It also appears likely that rent controls and three-year tenancy agreements could be introduced in London.

These changes come after the number of homes for rent fell in 2018 - the first drop in 18 years.

Landlords being forced from the rental sector

This was the result of landlords being forced from the rental sector with many struggling to adjust to the effects of mortgage interest tax relief being phased out and stamp duty adjustments.

However, landlords have enjoyed low mortgage rates as lenders increasingly offer better deals from preventing landlords leaving for other lenders in a competitive market.

Among the BTL mortgage deals, lenders say that landlords are increasingly being attracted to five-year fixes, particularly after the Bank of England introduced stricter rental income rules for two-year fixed BTL mortgages.

Some lenders are also offering landlords cheap 10-year fixes if they want to lock into rates for the next decade.

One expert, Rachel Springall from Moneyfacts, says that economic uncertainties could see interest rates rise this year.

She added: "If house prices fall then this would impact landlords and as a combination, it will make it more expensive for them so they need a good mortgage deal and need to keep an eye on their income."

Ms Springall also warns that should rental demand fall this will see landlord incomes being squeezed and in a bid to reduce their losses they may decide to sell off homes in difficult financial times.

Fewer landlords investing in more properties

Meanwhile, it's been revealed by one firm of estate agents that there are fewer landlords wanting to buy more rental properties,.

The research from Haart highlights that the number of landlords registering to buy has dropped substantially in England and Wales.

The firm says that numbers have fallen by 36% but they have dropped by 47% in London.

Haart's chief executive, Paul Smith, said: "The drop in numbers of those registering to buy in London indicates buyers waiting for political infighting to blow over."