One of the problems with having an office at home is that I am responsible for keeping it tidy. My wife, who likes clutter about as much as Donald Trump likes a kale smoothie, has given me some disapproving looks of late, so last weekend I commence a long overdue tidy up. After about 20 minutes, I found myself poring over a photo album, which eventually reminded me of an event I spoke at recently, following the latest budget.
There seems to be a competition running at present to see who can deliver the most newsworthy budget. In terms of column inches, I suspect the Starmer/Reeves effort may end up overtaking the Truss/Kwarteng offering by some margin, given the sheer number of people it has managed to upset.
At the event, given the latest set of punitive measures that landlords will have to face, I was asked what advice I would give to people looking to get into property in 2025. My answer was a simple one - don’t swim against the tide.
All property enterprises are businesses, whether doing a simple buy-to-let, building your own home, or converting a building into flats. However, many people make the mistake of diving into these enterprises without treating it as a business decision. If you look at the single buy-to-let model, from a business perspective, the wheels are to some people just clinging onto the bus. It’s been the decade of the long knives, from George Osborne’s first initial blow in 2015 when he announced the 3% stamp duty surcharge and reduced the tax relief landlords could claim on mortgage payments. This was followed by a rain of further financial blows from successive chancellors, plus a parallel increase in the regulatory obligations that landlords were obliged to adhere to. This now includes the proposed Renters Reform Bill, which will make it more difficult to evict tenants. The recent budget is simply the latest in a long line of anti-landlord policies, with little evidence that this government (or any other) is likely to stop wielding the knife any time soon.
As a result, there’s understandably been an increase in the number of landlords looking into HMOs, as these typically deliver a better yield. However, they, too, have had their challenges from a business perspective.
They’re still subject to increased regulation, plus many areas of the country have reached saturation point. Article 4 directions for HMOs are now common across many of our cities, making it almost impossible to get planning permission to create one. And people don’t like the thought of having a multi-let unit next door, which makes it more likely you’ll see local opposition. Serviced accommodation has also been in the wars, with many local authorities using increased taxation to try and reduce the number of holiday lets, so that local people can get on the housing ladder (building more new homes doesn’t seem to have occurred
to them).
