Residential Lettings offer a safe harbour for the year ahead
27th February 2017
27th February 2017
Market comment from Mark Hoskin, of Marchand Petit - in the Lettings market, where success is traditionally founded on stability, 2016 was defined by change and external uncertainty. Influenced mainly by modifications in the buy-to-let market which included, to name a few, stamp duty changes relating to second home ownership, tougher affordability on buy-to-let mortgage products and Brexit.
Now we are in 2017, the headline change is George Osborne’s decision to cut mortgage interest tax relief in last year’s Summer Budget, which comes into force this April. However, the tax fall-out on landlords continues with changes on how wear and tear deductions can also be made.
All of this means that becoming a landlord for the first time, or expanding a small portfolio, is more difficult and less appealing. Therefore, expect national buy-to-let mortgage transaction levels to reduce in 2017.
However, in choppy waters people head for safe harbours and at Marchand Petit across our offices in the South Hams, an area with high second home ownership levels, we have seen existing holiday home and second home owners shift their focus to residential lettings in larger numbers. As they look to take advantage of the benefits that a long-term tenant and income brings.
With interest rates set to stay at record lows for the immediate future, property remains an attractive option for any investor with capital and a medium to long term view for return.
After a very successful 2016, the first months of this year show no sign of slowing. This view is obviously shared by investors and landlords locally. With demand in the key areas of the South Hams set to continue to outstrip supply, driven mainly by first time buyers staying in rental accommodation for longer periods as raising a deposit remains testing, or FTB’s wait on new homes incentives. Rent levels look set to remain steady and above the regional average.
Marchand Petit offers a total property solution for home buyers in this lovely region of Devon. Across our multi-disciplined departments, our breadth and depth of experience at local level is second to none. We are the agent of choice for anyone in this area and we will work with you every step of the way to ensure you find the tenant, or property, that matches your requirements. For further information please contact Marchand Petit’s Lettings office on 01548 855599.