Unwanted Treble for Private Landlords in Scotland
Unlike Celtic FC, private landlords in Scotland have received an unwanted treble dose of terrible news.
Rents in the British private rented sector increased by just 1.8% in the 12 months to April 2017.
This compares with an inflation rate for the same period of 2.7%
In Scotland, the comparison was even bleaker.
For while prices rose there was no corresponding growth in rents, according to the Office of National Statistics (ONS).
In England rental prices increased by 2% and by 0.7% in Wales
These new figures come hard on the heels of data which reveal that average house prices in Scotland hardly rose at all in the year to March, according to the ONS.
The official figures show that the price rise in Scotland was just 0.7 per cent.
In England, house prices increased by 4.4%, while Wales and Northern Ireland each experienced a rise of 4.3%.
Neither of these sets of figures will make for comfortable reading for Scotland’s private landlords.
But there was more bad news to come with the announcement that the UK housing market saw a drop in buy to let activity in April.
The new cut to mortgage tax relief for landlords was being blamed for the decline.
It means that the proportion of buy to let valuations is 6% below the five-year average for April.
And it is even lower than it was in April last year when an extra 3% stamp duty surcharge was introduced, according to the latest data from Connells Survey and Valuation.
The report says that the decline in buy to let valuations has likely been driven by the stamp duty surcharge and the cut to buy to let mortgage tax relief.
As of April, landlords can only offset 75% of mortgage interest payments against rental income, down from 100% in March and the amount will continue to fall in the next few years.
According to John Bagshaw, corporate services director of Connells Survey & Valuation, Government policies have been hitting smaller landlords and over the last year buy to let valuations have made up less than 10% of market activity, representing a new low in April.
“This could suggest that smaller, private landlords, who typically use buy to let mortgages, have not been investing on the same scale as previously seen.
“Buy to let used to be seen as a viable way to gain additional income or to fund retirements,” he explained.
Individually, each of those pieces of research may not amount to much.
However, taken collectively, they suggest dark clouds are forming over Scotland’s private rental sector, with costs starting to increase at a faster rate than returns.
Consequently, there are increasing doubts over the long-term investment prospects of buy to let properties.
If you own rented property and are unsure about what the future may bring, then perhaps we may be able to help.
R&T Property Solutions buy property in all parts of Scotland.
Our head office is in Glasgow, but we are interested in purchasing your portfolio wherever in Scotland it may exist.
It won’t matter to us if it is a single small flat or a number of larger homes, whether in Edinburgh, Dundee, Aberdeen, Inverness, Stirling, Falkirk, Perth, Dumfries, or anywhere in between.
If you own property in Scotland and want to sell in a hurry, then please contact us right away.
And don’t worry if you have a problem property in Glasgow, or elsewhere.
We specialise in buying these types homes in Glasgow, where we have bought many in the past.
In addition, we have purchased tenanted property in Edinburgh.
When we have visited these homes in Edinburgh we have done so without upsetting the tenants. That’s because we don’t normally require internal access to reach a valuation.
And don’t worry if you own a flat in Aberdeen, where property has been underperforming as a result in the fall of oil prices.
We’d like to hear from you if you have property in Aberdeen.
We understand that sometimes a property owner needs to sell in a hurry. That’s why we’re prepared to agree a fast deal.
We normally don’t require a Home Report and can pay cash if you prefer.
If you sell your flat to R&T Property Solutions, then there will be no broker’s fee and no estate agents charges.
And if you are prepared to use one of the lawyers on our panel, you might be able to avoid paying any legal fees.
So don’t delay, phone our experts today.
Just dial +44 (0) 141 636 0521 and we’ll give you a fair valuation, which you are under no obligation to accept.