If you’re interested in residential property as an investment, a shock BBC report reveals the majority of house prices across England and Wales are lower in real terms than ten years ago.
Tools From The BBC Could Help You Discover The Best Areas For Residential Property Investment
Residential Property Will Always Be A Popular Investment
The BBC data team and the Open Data Institute analysed more than eight million residential property transactions in England and Wales, covering the 10 years to July 2017.
Although most regions have seen rising house prices, in more than half of neighbourhoods, the conclusions revealed that residential property values have not kept pace with inflation.
In fact, adjusting the figure for inflation, the value of an average residential property in England and Wales hasn’t increased at all in the last 10 years.
If you’re a residential property investor, it’s well worth taking a look at the findings of the BBC report.
It could well help you unearth areas that could give rise to significant property appreciation. And it could also prevent you from investing in areas that could be prone to potentially falling values.
In addition to a broad summary of the research, the BBC has published some useful graphs that could be invaluable as you consider your next investment. There’s also a particularly helpful online tool that enables you to search for house price changes by postcode and by wider areas.
Here’s a link to BBC’s residential property findings.
Residential Property Landlords Have Faced A Battering In Recent Budgets
As many SIPPclub Members are residential property investors, earlier this year, we summarised the landscape at the time in an article entitled 5 Property And Pension Things To Know About.
On the eve of the November 2017 Budget, it’s worth having a look at three articles recently published on FT Adviser, the industry publication dedicated to the financial intermediary market covering investments, mortgages, pensions, insurance, regulation and other key issues.
Tax Relief Changes Forecast To Spark Property Crash
Experts have expressed concern that tax relief changes could cause a property crash. Provider of audit, tax and consulting services RSM has suggested that tax changes facing residential property landlords could push up the cost of renting for many tenants.
Landlords can deduct mortgage interest and other finance-related costs from their rental income before calculating their tax liability. But this interest relief is being slashed which could double or triple the tax owed by some landlords.Residential Property News
Pension Freedoms Set To Create Buy-To-Let Boom
Research from Retirement Advantage showed that despite the increased tax and regulatory burden on landlords, residential property continues to be a favourite for many older investors. As many as 10 per cent of people are thinking about residential property investment in their retirement. The primary reasons cited are the prospect of capital growth and the provision of a possible boost in retirement income.
Residential property investors have recently been hit by cuts to tax relief, a 3 per cent stamp duty surcharge on additional property purchases and tighter underwriting rules mandated by the Prudential Regulation Authority. And whilst the retired are keen on residential property investment, it's been reported that one in five landlords is thinking of selling up as a result of the changes.Residential Property News
Landlords Rush To Incorporate Despite Mis-Advice Fears
Limited company borrowing now accounts for nearly four out of every five pounds lent for residential property investment, says Mortgages for Business. It reports that borrowing via a limited company has surged in popularity following a raft of tax and regulatory changes that have led to spiralling costs for individual landlords. Limited companies are exempt from the tax relief reduction due to be phased in by 2020, and they also enjoy a range of other tax benefits.
However, mortgages granted to limited companies are generally more expensive, leading to claims that unwary residential property investors could see their income cut by £1,000 each year if they choose to incorporate. Limited companies also face a range of additional costs associated with setting up and running the business, and they do not benefit from a capital gains tax allowance when selling properties.Residential Property News
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