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Experience Invest

Budget 2015: Why buy-to-let landlords need to think long term

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Here at Experience Invest we’re well aware of the changes for buy-to-let landlords made in the Summer Budget. The changes made by George Osborne have certainly set those in the buy-to-let industry talking with various influential figures commentating on the chancellors announced change to mortgage tax relief for landlords.

The level of mortgage tax relief is set to be cut from 40/45 per cent to just 20 per cent in effort to make the housing market playing field a more level one for ordinary house buyers. This is a significant change for anyone investing or already invested in buy-to-let property.

What the experts are saying

The new rules have set experts tongues wagging with most agreeing that the main thing to do is to factor all extra costs in before making any new purchases. The other thing to always keep at the back of your mind when considering investing in a new buy-to-let property is that interest rates are sure to rise over the next five to ten years.

Experts are also advising that costs involved in purchasing a buy-to-let property are now going to be more important than ever to any possible future profitability. Voids, repairs and insurance all need to be properly studied before purchasing now that mortgage tax relief has been slashed.

The long term

Your own level of risk must be managed before making any new buy-to-let investments and you’d be wise to seek a second considered opinion in some cases. Current landlords may also now consider hiking rents to help cover costs, this could have a double impact on Generation Rent.

Overall, those entering the buy-to-let market should always be looking at the longer term for profits. Of course rental income and profiting from your asset are a big focus, but the longer term financial benefits need to be kept in mind when deciding whether to invest or not.

Experience Invest

Experience Invest have been trading since 2004 and we’ve worked with all types of investors from first timers to high-NET-worth individuals and corporate clients. As market leaders in UK residential investments, we specialise in high demand, high yield property investments. For more information, or to discuss your own investments needs please contact Experience Invest.