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  • Tax

    EXCLUSIVE - "Tax changes for landlords could lead to homelessness" says Fergus Wilson

    As high profile landlord, Fergus Wilson, has been very vocal on recent tax changes for landlords, both on Property Tribes and in the broadsheets, we have recorded an exclusive video with Fergus on this topic.

    We appreciate that the interview is quite a bit longer than usual, but Fergus was on a roll and we believe it is well worth watching, as Fergus makes some very pertinent points:





    If you have any comments for Fergus, please drop them here.

    Fergus is also active on our other thread about 9 irrefutable reasons why property remains a viable investment.

    If you are concerned about tax changes for landlords, please join us at the BIG TAX DEBATE at the Property Investor Show on 9th October at 4.00 pm.

    Preview of the Property Investor Show and book your tickets.

    A reminder of:

    Property Tribes Action Plan

    1. If you have not already done so, write to your MP to let him/her know about your concerns.

    2. Have your views heard on the Finance Bill by writing to the Public Bill Committee. See >>> here for further details.

    3. Send your concerns and stories to Richard Dyson at the Telegraph. He is looking for real life situations and landlords to record video interviews with. Write to him at richard.dyson (at) telegraph.co.uk.

    4. Join a landlord association because there is strength in numbers! Property Tribes is a partner of the Residential Landlords Association who are lobbying Government very hard on this issue.

    5. Sign the petition against these tax changes >>> here.

    6. Create awareness of this issue on the social web by sharing this post on Facebook, Twitter etc. and on all the property forums and groups you frequent.

    You can cut and paste this ready-made social media up-date:

    Join the property community in fighting the recent tax changes for landlords. The fight back starts now! http://ow.ly/RYujr #property

    This issue affects not only the 2 million landlords in this country, but also their hundreds of thousands of tenants. It also affects the livelihood of lettings agents, and service providers to the property industry. We must all unite against this and create awareness so that our voice is heard at a political level.

    [Image: house.png]Budget related content:

    Summer Emergency Budget from a landlord and property perspective

    Budget beating strategies for landlords

    Budget changes - what lies ahead?

    5 ways to beat the budget

    65% of landlords considering rent rises following the Budget

    New investor - is it still worth it - calculations?

    Government response to Petition

    20% of landlords are thinking of quitting BTL due to recent tax changes

    Petition Committee response to Petition

    9 irrefutable reasons why property is still a viable investment + Landlord Survival Plan

    Tax changes - existing portfolio landlord perspective
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    It is absolutely a tax on tenants, this is a nationwide thing all landlords viewing a increase in expenditure at the same time all having there break even point rising.

    Landlords will look to increase rent to cover the cost - that can only be done if demand outstrips the supply. I think it does down south! except the problem is affordability down south is already stretched!

    As for Institutional Investors - the government had a consultation this year, asking why despite making it easier is there a lack of investment in the Private Rented Sector. The answer was the returns are minimal and slow - they can get better returns by build-to-sell rather than build-to-rent.
    There shareholders want short term returns, not really long term as us smaller investors are happy with.

    I agree with Fergus, smaller landlords will look at something else to invest in. Institutional Investors will sure get involved as rents shoot up with an even lower supply.

    [Another great interview Vanessa]
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    Good solid interview with a fair overview of what is going on.

    I think the government stance deals in one hit with a multitude of their different agendas. I dont believe there will be a mass sell off except perhaps by a few high volume investors with large high leveraged portfolios. But proportionally they are relatively small. Most will adapt

    Some councils at a local level may be tested by this but countrywide councils will have to absorb the homeless as they always have done albeit not always that well. I heard there are 400 homeless in MK at the moment. ( not necessarily a reliable source)

    One of my ex tenants was being shifted from a B&B in central MK to one 20 miles away in Bedford because the rooms were needed for the Rughy World Cup fans coming our way! How is his little girl expected to get to her school from there I dont know. Its a real mess. I think the freeze on LHA will be the killer more than the tax in adding to the homeless stats . LHA tenants cannot top up with what they dont have . The DHP fund will have to be increased in time if that side effect is not addressed

    But across the board its effect will be diluted and people will continue to invest in BTL but maybe will have to settle to make only half a million over the years not the full million. But thats still a good sum to retire on

    Property investment will still outshine the traditional pension so many will keep buying and gradually acquiring wealth in the background. They will just be keeping their day job for a little bit longer than they may have first thought
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    Jonathan Clarke. http://www.buytoletmk.com


    Hoorah for Jonathan talking some sense.

    I think the government stance deals in one hit with a multitude of their different agendas. I dont believe there will be a mass sell off except perhaps by a few high volume investors with large high leveraged portfolios. But proportionally they are relatively small. Most will adapt
    I think the freeze on LHA will be the killer more than the tax in adding to the homeless stats . LHA tenants cannot top up with what they dont have .


    Additionally, the effect of 10% wear and tear has been under emphasised IMO.

    It's been a campaign by a particular niche group to defend the indefensible. The fact that they are worried about homelessness is a smokescreen - it's their wealth they are bothered about.

    EXCLUSIVE: Any changes in the tax system will result in some business owners (not property) loosing their home.
    It's a fact of life, move on and adapt
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    Full time Landlord in WestYorkshire, mentor and property education to new and inexperienced PRS investors. 25+ years of working knowledge. RLA member http://www.landlordgeoff.co.uk [color=#800080]


    Geoff, could you be so kind as to clarify who is using homelessness as a smokescreen?
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    A good interview.

    Independent of what some people think of Fergus as a person, I think he explained the various issues rather well.

    A subtle point he made about raising the rents if the tex bill goes up should be called out. The level of rent is set by the market and at some level, the tenant's will not have the ability to pay. When there is a shortage of housing, it is natural for the rents to rise and for landlords to be able to pass on increased costs. Penny for penny as Fergus said.

    If the supply of housing exceeds the demand or the tenants have no capacity to pay, the rents will not rise. Normal market forces.

    Thanks for sharing the information and the action plan.

    (01-10-2015 01:41 PM)Jonathan Clarke Wrote:  Good solid interview with a fair overview of what is going on.

    Completely agree

    (01-10-2015 01:41 PM)Jonathan Clarke Wrote:  I think the government stance deals in one hit with a multitude of their different agendas. I dont believe there will be a mass sell off except perhaps by a few high volume investors with large high leveraged portfolios. But proportionally they are relatively small. Most will adapt

    The multiple agendas does ring a bell with me. One agenda is to quiet down the Generation Rent tribe. They will not be able to claim it is tax advantages that stop them from buying a home compared to the BTL investor. I am curious what their next complaint will be. Facts are rarely an impediment to their beliefs.

    (01-10-2015 01:41 PM)Jonathan Clarke Wrote:  [A]cross the board its effect will be diluted and people will continue to invest in BTL but maybe will have to settle to make only half a million over the years not the full million. But thats still a good sum to retire on

    The market will adjust.

    If Fergus is correct and we have a safer BTL sector because there is less debt and more equity, the country may be better off.

    What the BTL investors really benefit from is the lack of supply. If the supply problem was fixed, the BTL investors would definitely make money more slowly. I am all for building more if it is not funded by higher taxes. The private sector can easily afford to fund more properties.
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    John Corey 


    I host the London Real Estate Meet on the 2nd Tuesday of every month since 2005. If you have never been before, email me for the 'new visitor' link.

    PropertyFortress.com/Events

    Also happy to chat on the phone. Pay It Forward; my way of giving back through sharing. Click on the link: PropertyFortress.com/Ask-John to book a time. I will call you at the time you selected. Nothing to buy. Just be prepared with your questions so we can use the 20 minutes wisely.


    (01-10-2015 02:50 PM)john_corey Wrote:  A subtle point he made about raising the rents if the tex bill goes up should be called out. The level of rent is set by the market and at some level, the tenant's will not have the ability to pay. When there is a shortage of housing, it is natural for the rents to rise and for landlords to be able to pass on increased costs. Penny for penny as Fergus said.

    I think I understand his logic...

    He has the option to sell into a very fast moving market, there is a level of after tax income that he will except instead of selling. So if a tenant moves out due to the increased rent, the property can just be sold.

    Therefore the level of rent set by the market does not affect what he can ask for, as he does not care if the tenant decides to leave.

    Hence what he does, does not much up to what landlords outside of the south can do.
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    (01-10-2015 02:50 PM)john_corey Wrote:  A subtle point he made about raising the rents if the tex bill goes up should be called out. The level of rent is set by the market and at some level, the tenant's will not have the ability to pay. When there is a shortage of housing, it is natural for the rents to rise and for landlords to be able to pass on increased costs. Penny for penny as Fergus said.

    If the supply of housing exceeds the demand or the tenants have no capacity to pay, the rents will not rise. Normal market forces.

    You have expressed that very well John, and I think most people understand how market forces work, but for some reason the Landlord community have put on socio-economic blinkers.

    I read time after time - "this will force up rents"

    YES! That is the objective:- to make Home Ownership cheaper than renting..
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    Vanessa
    Having looked in the dictionary, perhaps “smokescreen” was the wrong word to use. My post was not targeting any specific person it was merely my observation of the situation, after all the headline was "Tax changes for landlords could lead to homelessness" and was only one of the points made in Fergus Wilson’s interview.

    The point I was trying to make was that the word "homelessness" has been used extensively in the overall social media tax change campaign. IMO it may be a limited consequence of the tax change but also IMO it is secondary to the consequences to,and aims of, many the campaigners, . I also accept that the changes will affect many landlords and it is understandable that they are trying to do something about it.
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    Full time Landlord in WestYorkshire, mentor and property education to new and inexperienced PRS investors. 25+ years of working knowledge. RLA member http://www.landlordgeoff.co.uk [color=#800080]


    Thanks for clarification Geoff.

    It was hard to know which quote to use for the title, as Fergus said so many pertinent things in the interview.

    One thing I do know we are battling against is LANDLORD APATHY and therefore I feel compelled to use quotes that will engage people in some way with this issue.

    If I used something insipid then less people would be interested in actually engaging with the information.

    Just like the Get Rich Quick marketeers have to use headlines like "Be a millionaire in a year", I have to employ the same tactics here to ensure that the message reaches as many landlords as possible.

    Thank you for your forebearance. Smile
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    (01-10-2015 08:25 AM)Vanessa Warwick Wrote:  As high profile landlord, Fergus Wilson, has been very vocal on recent tax changes for landlords, both on Property Tribes and in the broadsheets, we have recorded an exclusive video with Fergus on this topic.

    We appreciate that the interview is quite a bit longer than usual, but Fergus was on a roll and we believe it is well worth watching, as Fergus makes some very pertinent points:





    If you have any comments for Fergus, please drop them here.

    Fergus is also active on our other thread about 9 irrefutable reasons why property remains a viable investment.

    If you are concerned about tax changes for landlords, please join us at the BIG TAX DEBATE at the Property Investor Show on 9th October at 4.00 pm.

    Preview of the Property Investor Show and book your tickets.

    A reminder of:

    Property Tribes Action Plan

    1. If you have not already done so, write to your MP to let him/her know about your concerns.

    2. Have your views heard on the Finance Bill by writing to the Public Bill Committee. See >>> here for further details.

    3. Send your concerns and stories to Richard Dyson at the Telegraph. He is looking for real life situations and landlords to record video interviews with. Write to him at richard.dyson (at) telegraph.co.uk.

    4. Join a landlord association because there is strength in numbers! Property Tribes is a partner of the Residential Landlords Association who are lobbying Government very hard on this issue.

    5. Sign the petition against these tax changes >>> here.

    6. Create awareness of this issue on the social web by sharing this post on Facebook, Twitter etc. and on all the property forums and groups you frequent.

    You can cut and paste this ready-made social media up-date:

    Join the property community in fighting the recent tax changes for landlords. The fight back starts now! https://ow.ly/RYujr #property

    This issue affects not only the 2 million landlords in this country, but also their hundreds of thousands of tenants. It also affects the livelihood of lettings agents, and service providers to the property industry. We must all unite against this and create awareness so that our voice is heard at a political level.

    [Image: house.png]Budget related content:

    Summer Emergency Budget from a landlord and property perspective

    Budget beating strategies for landlords

    Budget changes - what lies ahead?

    5 ways to beat the budget

    65% of landlords considering rent rises following the Budget

    New investor - is it still worth it - calculations?

    Government response to Petition

    20% of landlords are thinking of quitting BTL due to recent tax changes

    Petition Committee response to Petition

    9 irrefutable reasons why property is still a viable investment + Landlord Survival Plan

    Tax changes - existing portfolio landlord perspective



    I don't care how long your interviews are
    The longer the better so as to give interviewees the maximum opportunity to fully express their perspective on things
    I'd like to see a half hour or even longer format with industry professionals
    This would greatly assist the PTB when they can see directly what is occurring in the PRS
    I would like to hear a lot more from Fergus as he has a degree of gravitas which few LL can muster
    I would like to see a long interview with Angela Bryant as to her response as another very successful LL to these idiotic budget tax regulations
    I'm sure such an interview would be viewed by many tenants to see what will be happening to them
    Perhaps even government officials would finally understand what they will be doing to tenants Effectively taxing them on their tenancies as LL will have to pass on the costs of the budget tax changes!
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