The commercial mortgage and bridging finance sector is urging the next Prime Minister to implement significant planning reforms and provide support for landlords to address the UK’s housing challenges. The call comes from TAB, a leading commercial mortgage and bridging lender, highlighting the need for practical changes to stimulate investment and development in the property market.
What Planning Reforms Are Needed?
Karen Rodrigues, sales director at TAB, emphasised that the current planning system is a major barrier to development. She argues that the next government should introduce a refreshed planning framework that includes statutory deadlines and increased resources for local authorities. A presumption in favour of converting unused commercial spaces into residential units is also essential. This would streamline the approval process for change-of-use applications, enabling quicker transformation of vacant retail and office properties into mixed-use developments.
How Will This Impact Landlords?
Landlords play a pivotal role in addressing the housing demand in the UK, particularly as social housing supply struggles to keep pace. Rodrigues pointed out that the private rented sector (PRS) is vital until more social housing is built. She urged the next government to support landlords by reversing punitive tax policies that have burdened the sector. Key reforms suggested include reinstating mortgage interest tax relief for individual landlords and eliminating the stamp duty surcharge, which has deterred investment.
What Changes Are Proposed for Business Rates?
In addition to planning reforms, Rodrigues called for a review of business rates, which she described as a significant obstacle for high streets and mixed-use investments. Lowering business rates for independent retailers and hospitality businesses could enhance the viability of local enterprises and support tenants in semi-commercial properties. This approach aims to rejuvenate high streets and create a more conducive environment for local businesses.
How Does This Affect Bridging Finance Opportunities?
For property investors and borrowers, the proposed reforms could unlock new opportunities in the commercial and residential property markets. By addressing planning delays and reducing the tax burden, the government could support a more dynamic investment climate. This would not only benefit landlords but also enhance the overall housing supply, making it easier for borrowers to secure financing for new projects. Investors should closely monitor the government’s actions on these issues, as changes could significantly impact the profitability and feasibility of future investments. For more information on financing options, check out our bridging finance guide.
Frequently asked questions
What specific reforms are being requested for landlords?
Key reforms include reinstating mortgage interest tax relief for individual landlords, scrapping the stamp duty surcharge, and reintroducing the Wear and Tear Allowance to alleviate the financial burden on landlords.
How will planning reforms affect the property market?
Reforms aimed at streamlining the planning process and encouraging the conversion of commercial spaces into residential units could accelerate development, increase housing supply, and ultimately enhance investment opportunities in the property market.