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Shawbrook Bank M.D., Stephen Johnson is quoted in this article in the Financial Times about landlord behaviour following the introduction of Section 24. The article suggests that latest data shows landlords selling up some of their properties to pay down debt on other properties - to de-leverage - to mitigate the impact of S24.Read the full article and Stephen Johnson's quote According to HomeLet, 97% of the two million landlords in the UK have 3 properties or less. This is the "mass" market who are probably not yet aware of Section 24. I believe most of the sell-off's will have been in the 3% of portfolio landlords who are informed and see the dangers.When the mass landlord market gets wise to S24, then I believe we will see the sell-off of rental properties increasing dramatically. We will also see a decline in new entrants to the sector.As I have stated many times, a perfect storm is brewing for the PRS and there is a lot of pain to come for both landlords and tenants!SEE ALSO - Number of private landlords in declineUP NEXT - Resources for reducing landlord tax liabilityDON'T MISS - 1 in 4 landlords to exit due to Section 24NOW WATCH:
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
See I am not alone with my views other wise this would not be happening
Landlords are Not Buying and some are starting to sell
Learn Change and Adapt ?????
That, the economy and brexit are all factors. If margins are tight, best to sell first and ask questions later. Not everyone is sitting on large profits or large margins and able to sit out what may be ahead. Still its healthy in the long term.
Agreed - there is never usually just one reason in a market such as the complex UK property market. Another one to add to the list may be more interest rate rises to come and over-leveraged LL's are getting rid of their least favourite property(s) to keep the ones they do like?
Others may feel the market has peaked and are looking to off-load eg. held for 10 years and then move them on to look for other opportunities.
Just paid down mortgage on one of my properties. Bank seemed surprised I was doing it and ask why ?
Told bank Section24 has forced me to pay down. Adviser didn't know what S24 was.
I'm sure as more landlords sell or pay down debt they will know exactly what it is.
I am not surprised by your banks lack of knowledge
S24 is like an accident waiting to happen
we can see the issue but others are blind to it
I agree. I was shocked when he said what is S24 and I had to explain.
I guess his only interest is in keeping the Mortgage debt as high as possible.
I hope the banks start complaining to BOE about lack of investment from BTL market in the future.
I have no interest currently in investing on BTL unless a bargain comes up too good to miss.
For now i'm Value investing on my ISA portfolio and made around 9% last year which while not fantastic is much better and less stress than BTL.
I'll Sit and wait for S24 to kick in fully and assess the landscape.
I too have invested in ISA and Pensions now
I set my Goal for 8% growth on Both and I too passed that Target
a lot easier then BTL and Tax free Income later on
I have explained s24 to
Ect ect and they just don't understand what's happening there is going to be one hell of a bang here
Into the Valley of Death Rode BTL
These days most people only want to know the minimum required to carry out their jobs to a basic standard.
Hahaha! I was just thinking exactly the same thing today!
Perhaps Universities will soon be offering degrees in minimalism where any more than the bare minimum of work required to pass is met with an instant fail lol.
With the trades it's known as corner cutting.
I fit in nicely with these figures.
I have reduced my total mortgages by approx £700k this year and have turned nearly all of my current btls into 10 year repayment mortgages rather than interest only mortgages. It will be tight but gives me a new goal to work towards and seeing the 10 year spreadsheets tick down, month by month, will hopefully give me a focus to enable me to put up with the inevitable issues. It would take an unbelievable amount of persuasion for me to buy anything more now. I am hardly likely to either because even though the numbers stopped making any sense a long time ago in my area the prices are still jumping up (according to Zoopla).