Vulnerable People Allowed To Transfer Support For Mortgage Interest When Moving Home

Disabled people and others receiving support for mortgage interest (SMI) will be able to request the loan balance be transferred to their new property when moving home, the government has confirmed. SMI is the help offered by government to owner-occupiers in times of need. It is paid as a loan and contributes towards the interest on people’s mortgages if they are in receipt of certain benefits, to protect them against repossession and keep them in their own homes. This change will benefit those moving into a new property due to a disability or health condition, as they will continue to receive uninterrupted support towards their mortgage payments. Read more on the Mortgage Solutions website.

https://www.mortgagesolutions.co.uk/news/2019/06/12/vulnerable-people-allowed-to-transfer-support-for-mortgage-interest-when-moving-home/

PRS Landlords Need A ‘Stable Platform’ To Balance Social Housing Debate

More than a third of landlords are looking to cut their annual spending as rising running costs and higher taxes bite – just as the private rental sector (PRS) needs stable platform on which to balance “one-sided” social housing debate. Research released by specialist mortgage lender Kent Reliance reveals the average landlord now spends £3,571 per property in annual running costs, before tax or mortgage interest – equivalent to 32.9% of rental income. These costs have risen by 5.6% in the last two years without factoring in increasing taxes, having jumped by 28% – a rise of £771 – since the start of 2009. Read more on 24housing.

https://www.24housing.co.uk/news/prs-landlords-need-a-stable-platform-to-balance-social-housing-debate/

The Government Is 'Wiping Out The Buy-To-Let Economy'

Philip Hammond’s failure to reverse George Osborne’s deeply unpopular tax reforms will have far-reaching implications for the buy-to-let industry, it has been predicted. Government plans to strip buy-to-let landlords of mortgage interest tax relief will have a “detrimental impact” on households up and down and the country, according to David Hannah, principal consultant, Cornerstone Tax. From next month, landlords will start to lose the right to tax deduct their mortgage interest costs at the rate they pay income tax - currently up to 45%. Instead, they will see this fall over the next three years and replaced with a 20% tax credit. Hannah has criticised the move, claiming it will result in rent increases for tenants across the UK. Read more on the Home website.

Tax Reforms Harming Access To Rented Housing For ‘Vulnerable Tenants’

Residential Landlords Association (RLA) is pointing to figures out today showing surveyors believe private sector rents will increase by more than 20% over the next five years. The predictions come just weeks before changes are introduced that will mean landlords are taxed on their turnover rather than profit, and mortgage interest relief begins to be cut to the basic rate of income tax. The data confirms assertions that rents would need to increase by between 20% and 30% for landlords to offset the impact of these measures, coming alongside a stamp duty surcharge on the purchase of homes to rent out. Read more on 24housing.

440,000 Landlords Forced Up Tax Bracket From April 2017

More than four hundred-thousand landlords (22 per cent) who pay the basic rate of tax will be forced into a higher tax bracket from April next year (2017) as planned changes to landlord taxation come in to force. The changes mean landlords will no longer be able to deduct mortgage interest payments or any other finance-related costs from their turnover before declaring their taxable income. However, while 440,000 basic-rate tax payers will be forced into a higher bracket, all landlords could be at risk of seeing their tax liability increase regardless of their existing rate of tax. Read more on the NLA website.

Rent Rises Are Inevitable After Tax Clampdown On Buy-To-Let

Buy-to-let landlords may have failed in their legal battle against planned government tax relief changes for buy-to-let homes, but the real losers will be private tenants. The rules that permit landlords to offset all of their mortgage interest against tax will, from April 2017, be phased out, restricting the amount of mortgage interest landlords can offset against tax on their property investments. By April 2020 Section 24 will mean higher-rate tax payers will only receive 50% of the relief that they currently get. With many landlords likely to face the prospect of having their profits unjustly wiped out, the majority of landlords will have no option but to recoup their losses through higher rents. Read more on the Home UK website.

Mortgage Payments For UK First Time Buyers Have Fallen Sharply

First time buyers in the UK with small deposits are making savings of more than £790 a year, when comparing monthly mortgage payments to the same time last year, new research suggests. This is in part due to competitive interest rates now available as monthly mortgage costs for first time buyers have fallen sharply. The average house price for a first time buyer is £154,559 and for those with a 10% deposit, lower mortgage interest rates mean they can save £67 a month compared to what they would have paid if they’d taken out the same loan a year ago. This adds up to savings of £800 over the course of a year. Read more on the Property Wire website.

Landlords ‘Forced Into Debt’ If Interest Rates Rise By 2.5%

Buy to Let in seven out of 10 UK towns and cities could become unprofitable if interest rates rise by just 2.5% according to Property Partner. The average investment property would be making an annual loss of £325, the property crowdfunding platform report. Property Partner looked at more than 100 of the largest towns and cities in the UK, to see what impact interest rate rises, coupled with the changes to mortgage interest tax relief, would have on local buy-to-let markets. By 2020, buy-to-let investors will have lost higher rate tax relief on their mortgage interest payments. Read more on 24dash.

Almost Half Of Landlords To Raise Rent In 2016

With an uncertain year ahead for buy-to-let landlords, almost half (45%) are planning to raise their rents in 2016, and almost one in five (18%) are planning inflation-busting increases of more than 3%, according to a survey carried out by SpareRoom.co.uk. The most common reason landlords cite (38%) for raising rents is the additional costs incurred by new government legislation, meaning future cuts to mortgage interest and wear and tear tax relief, stamp duty changes and costs of the 2016 Right to Rent roll out will be felt by tenants as well as landlords. Other reasons for rent increases include rents rising locally (23%), expensive property repairs and maintenance (6%) and higher mortgage repayments (4%). Read more on 24dash.

Annual Housing Costs Hit £133 Billion

The total annual cost of housing across England and Wales is approximately £133 billion according to new research from property adviser, Savills. While mortgage interest and repayments make up 49 per cent of the total cost, private rents now account for 36 per cent of the nation’s housing costs. However, there is significant regional variation. In London there are relatively few households who own their own home mortgage free, private rent makes up almost half of the total cost of housing, bringing the average cost per household to £11,329. Meanwhile, in the North East where housing is comparatively less expensive and 24 per cent of the cost of housing is in the form of social rent, the average cost per household is £3,450. Read more on the Savills website.