The commercial mortgage and bridging finance sector is urging the next Prime Minister to implement significant planning reforms and provide support for landlords. TAB, a prominent commercial mortgage and bridging lender, emphasizes that the current planning delays and tax policies are hindering investment opportunities, particularly in commercial and mixed-use property markets.
What Planning Reforms are Needed for Bridging Finance?
Karen Rodrigues, sales director at TAB, highlights that the next government must prioritise planning reform to facilitate faster development approvals. She advocates for a planning system with statutory deadlines, increased resources for local authorities, and a presumption in favour of converting redundant commercial spaces. This approach aims to expedite change-of-use applications, allowing for the transformation of vacant retail and office units into mixed-use developments.
Rodrigues states, “While we are delivering commercial mortgages at bridging speed, the planning system is moving at a snail’s pace.” The proposed reforms aim to unlock projects, regenerate communities, and ultimately support economic growth.
Why is Landlord Support Important for Bridging Finance?
According to TAB, the private rented sector (PRS) plays a vital role in addressing housing demand. With social housing delivery lagging, the PRS is essential for meeting current needs. Rodrigues argues that successive governments have treated landlords primarily as a source of tax revenue, which has created barriers to investment.
She calls for the reinstatement of mortgage interest tax relief for individual landlords, the elimination of the stamp duty surcharge, and the reintroduction of the Wear and Tear Allowance. These measures are seen as important steps to support landlords and encourage further investment in the housing market.
How Would Business Rate Changes Impact Bridging Finance Investors?
Rodrigues also emphasizes the need for reforming business rates, which she believes are a significant burden on high streets and mixed-use investments. She suggests that lowering costs for independent retailers and hospitality businesses could bolster high street vitality and support tenants in semi-commercial properties.
By creating a more conducive environment for local businesses, the government can help rejuvenate high streets and stimulate economic activity. Rodrigues insists that the next Prime Minister must create conditions that allow local businesses to thrive, which would, in turn, benefit property investors and landlords.
What This Means for Landlords and Investors in Bridging Finance
The proposed changes are particularly relevant for landlords and property investors who have faced increasing challenges due to restrictive policies. If implemented, these reforms could lead to a more dynamic property market, encouraging investment in both residential and commercial sectors.
The focus on planning reform and landlord support could alleviate some of the financial pressures currently faced by landlords, enabling them to invest in property improvements and expansion. Furthermore, easing business rates could enhance the attractiveness of mixed-use developments, providing additional opportunities for investors.
Frequently Asked Questions
What specific reforms are being proposed for the planning system?
The proposed reforms include introducing statutory deadlines for planning applications, increasing local authority resources, and facilitating the conversion of redundant commercial spaces into mixed-use developments.
How would these changes benefit landlords?
By reinstating tax reliefs and reducing burdens like the stamp duty surcharge, landlords could see improved financial conditions, enabling them to invest more in their properties and contribute to addressing housing demand.