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Unbiased buy to let, property investment and letting coaching, mentoring, advice and seminars for landlords from top selling property author and media commentator.

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Landlords are not selling because of reduced Capital Gains Tax CGT says Lawrenson of LettingFocus.com

The doomsayers and those who would love to see the demise of buy to let said that the new tax year would see lots of landlords selling their investments.
Well sorry folks, as I predicted we now have new evidence that this does not appear to be happening.
In fact, the Royal Institution of Chartered Surveyors (RICS) has just found that just two per cent of landlords are playing to sell property when current tenancy agreements expire. This is down from the 4.6 per cent of landlords planning to sell in the three months to the end of January, and the 6.5 per cent in the three months prior to this.
There had been fears the restructuring of capital gains tax could see most landlords face a rush to the exit. However, this is clearly not the case.
"Fears landlords would take advantage of the more favourable capital gains tax regime to bail out of the buy-to-let market appear misplaced," commented Simon Rubinsohn, Rics chief economist.
He went on to add, "Significantly, with the reduction in loan-to-value (LTV) ratios by lenders leaving first-time buyers struggling to access the housing market, rents are now rising sharply and the expectation is that this trend will continue. The incentive to cash in on the lower tax rate is being outweighed by attractive yields."
I cannot say I am surprised.

Here is my tip of the week.
If you let to people who are unrelated and on a single tenancy agreement, it is best if you must make clear to them what joint and several liability means. To make it crystal clear, I send this email to all my tenants.
“Please note in case of any doubt, and as explained on your tenancy agreement that you are both jointly and severally liable for the whole rent. This means the tenancy is made with both of you as one party and with me as the other party.
It therefore means that you must usually BOTH give notice of your wish to terminate the tenancy at the same time and give me the due notice in writing.
Of course, when one of you leaves, the other could stay on but only if they notify me in writing of that fact and be prepared to pay the full rent on their own.
Also, jointly and severally liable, means that each of you is liable for the whole rent and in full for all moneys owing as a result of this tenancy agreement”
That usually does the trick but it is amazing how often tenants, especially student tenants fail to understand or check the meanings of terms like these when they sign an agreement.
I’m David Lawrenson from property consultants lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title buy the book
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying below market value. I’m an expert property public speaker and a well known property investment blogger and I contribute to newspapers and a host of property websites, write a property investment blog, a number of columns in the press and I run a landlords help service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property investors networking programme at my website.What’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week. Permission must be sought before using the material in the blog.

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