The buy-to-let market is changing as smaller landlords consider selling up. Research conducted by Simple Landlords Insurance has found that one third of landlords with one buy-to-let property are facing bigger challenges.
Many movements in the market have provoked the shift which started after tax changes were announced by former Chancellor George Osborne in 2015. The tax changes for buy-to-let landlords were first introduced to support first time buyers and make it easier for them to get on the housing ladder. Other government changes included a 3% surcharge on stamp duty which was introduced in April 2016 and a higher tax on rental income came into action in April 2017.
Meanwhile, larger landlords seem less fazed by the tax changes in the market and are seen to be taking advantage of increasing tenant demand. Landlords with 2 or more properties are also investing in a larger portfolio.
Landlords in the buy-to-let market seem to be evolving with the changes and are investing differently in more diverse portfolios. Many landlords are starting to put their money into higher yielding properties such as holiday lets, flats and houses in multiple occupation.
Although the new tax changes may seem like doom and gloom to many buy-to-let landlords, much of the research shows an uncertain but optimistic future.