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TODAY'S OTHER NEWS

Now is a ‘great time’ to invest in UK property, says LSLi director

It is now a ‘great time’ to invest in the UK housing market despite a new report showing that house price growth continued the trend of the past few months in August with a further moderation in both the annual and quarterly rates of increase, according to Adrian Gill, executive director of estate agency at LSLi. 

The annual rate of house price growth across 20 of the largest UK cities slowed to 8.2% in August, from 9.5% in July, taking the average to £239,400, according to the latest Hometrack UK Cities Index.

The slowdown in the rate of house price growth partly reflects increasing difficulties in purchasing a home as house prices continue to increase more quickly than earnings which has constrained demand. 

But despite the curbing of house price growth, there are clear signs that the housing market is now settling down after the initial shock of the outcome to the referendum, supported in part by the Bank of England’s recent interest rate cut, illustrating the underlying strength of the residential property market which should stand it in good stead for the long term future. Now is a ‘great time’ to invest in UK property, says LSLi director

Gill (right) said: “It’s really no surprise to see a softening in house price growth over the summer months. Nor should this easing in price inflation be considered a cause for concern. The unsustainable rate at which property values have been rising has meant that many potential homebuyers have been priced out of the market – especially in areas like London and the South East.

“The truth is, now is a great time to buy a home. The fundamentals of the housing market remain strong, with record low interest rates and lenders maintaining their appetite to lend.”

Gill wants to see more done to help tackle the “huge imbalance” between the supply and demand of properties, which will ultimately continue to place upward pressure on home prices, particularly in the medium to long term. 

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    Has Mr Gill not heard of S24 of the 2015 Finance Act (restriction of mortgage interest relief)? It beggars belief that someone can say that it is a great time to invest in UK property when this ticking time bomb gets ever closer to going off!

    Granted that some will be unaffected because they do not need mortgages, but actually they may well be better off putting their money elsewhere rather than accept the yields in UK property.

    Granted that some people will incorporate thus so far avoiding the effects of S24, but that may change, and they will pay corporation tax plus tax on taking the money out of their lettings business.

    But for most people there could not be a worse time to invest in UK property, S24 will devastate their investments. The tax change will undoubtedly force up rents but some landlords will still face bankruptcy as HMRC tax them on fictitious profit at rates which can exceed 100% of true profit. Indeed if for any reason the landlord makes no profit they can still be taxed at a potentially INFINITE rate!

    A great time to invest in UK property???? No I don't think so Mr Gill.

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    Well said Mr. McKay! Anyone who thinks now is the time to invest clearly hasn't understood this government's insane agenda.

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    Property investors should stand together and force the government to scrap the restriction of mortgage interest relief rule. It is clearly UNLAWFUL, unfair and discriminatory - what other businesses pay tax on losses? (or 'fictitious profit'). Why one rule for landlords/investors and another rule for all else?

    Many average, hard working investors (and families) will be financially ruined over the coming years by this rule unless changed urgently.

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    That's the plan Matt, to fight Government I mean, not be financially ruined! The first hearing for the Judicial Review is on 6th October.

     
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