Lending increases

Buy-to-let lending saw its highest monthly increases in November and December since stamp duty changes were introduced last April.

Landlord borrowing was up 10% for the two months, although this figure was 7.4% down on the previous year. Over two-thirds of buy-to-let loans were re-mortgages rather than house purchases. Buy-to-let lending, driven by re-mortgage activity, saw its strongest monthly lending level since the stamp duty changes on second properties introduced last April.

It’s expect buy-to-let lending levels in 2017 will be slightly lower than their 2016 as further tax changes take effect. Monthly lending to first-time buyers surprisingly rose by 4% in December last year and the trend is continuing into 2017.

Forecasts for 2017 may be less bullish than a year ago, as economic uncertainty weighs on the market, but experts are predicting a steady stable year.

While the regulatory changes to property investment are challenging, the property market will continue to offer strong returns to those who take an intelligent and level-headed approach to their portfolios. Landlords need to factor the forthcoming tax changes into their financial planning, and should always consult with a professional tax adviser.

The majority of landlords are confident that the future is strong as property in the UK still offers a sound return on investment. A good number of landlords have incorporated their business to help reduce the tax liability, and this route seems to be very popular with new entrants into the letting market.

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