The call for planning reforms and enhanced support for landlords has gained momentum, particularly as the UK prepares for a new Prime Minister. The specialist finance sector, including bridging finance, is poised to play a significant role in addressing housing shortages and revitalising communities, but current planning delays and tax policies are hindering investment.
What Are the Key Issues Facing Property Investors?
According to industry experts, the primary concern for property investors is the sluggish planning system, which is impeding the speed at which projects can be approved. Karen Rodrigues, sales director at TAB, emphasises the need for a reformed planning system that includes statutory deadlines and better local authority resources. This would facilitate quicker change-of-use applications, particularly for converting vacant retail and office spaces into mixed-use developments. The current pace of planning approval is described as moving at a “snail’s pace,” which is detrimental to both businesses and investors.
How Can Landlords Benefit from Proposed Reforms?
Landlords are urged to be a focal point in the upcoming government’s agenda. The private rented sector (PRS) is deemed essential for meeting housing demand, especially in light of insufficient social housing. Rodrigues advocates for the reinstatement of mortgage interest tax relief for individual landlords, the elimination of the stamp duty surcharge, and the revival of the Wear and Tear Allowance. These measures aim to reduce the financial burden on landlords and encourage investment in rental properties.
What Changes Are Needed for Business Rates?
Another area highlighted for reform is the business rates system, which is seen as a significant obstacle for high streets and mixed-use investments. Lowering costs for independent retailers and hospitality businesses could invigorate local economies and support tenants in semi-commercial properties. Rodrigues suggests that policies aimed at reducing business rates would create a more conducive environment for local businesses to thrive, ultimately benefiting the property market.
What This Means for Bridging Finance and Investors
For those involved in bridging finance, these proposed reforms could lead to increased lending opportunities and a more dynamic property market. The focus on faster approvals and reduced tax burdens would likely stimulate demand for bridging loans, as investors seek to capitalise on new opportunities. The current system, which often discourages transactions due to high taxes, needs to be addressed to support a more active market. Investors should keep an eye on the upcoming government’s policy changes, which could significantly impact their strategies and the overall health of the property sector.
Frequently asked questions
What reforms are being proposed for the planning system?
The proposed reforms include introducing statutory deadlines for planning approvals, increasing local authority resources, and facilitating the conversion of redundant commercial spaces into mixed-use developments.
How will changes to landlord policies affect the rental market?
Changes such as reinstating mortgage interest tax relief and removing the stamp duty surcharge are expected to alleviate financial pressures on landlords, encouraging them to invest more in the rental market and help meet housing demand.