UK Finance, a leading industry body for banking and other financial matters in the UK, is to keep a close eye on the recent law changes in the buy to let market. Working closely with the government and other key stakeholders in the UK housing market, they are monitoring the industry, looking at the challenges and opportunities these changes are making. This was revealed by UK Finance chief executive Stephen Jones.
Speaking to the audience at an annual lunch for UK Finance and highlighting the challenges ahead for the financial year, he said: ‘In particular, we have seen a recent fall in buy to let investment, driven by recent tax and legislative changes. Our analysis shows the number of buy to let mortgages fell to 74,900 in 2017, down 27% on the previous year’.
However, he went to say that the impact of the changes is not being felt in the same way right across the country. In northern England and Wales, investment has been more resilient and even produced higher yields. This was matched by a fall in the high value, low yield investments of the south east and London.
Jones said: ‘Any impact on business confidence and the economy will also be felt in the housing market. It could also impact on access to capital markets, an issue I know some of our members have raised.’
He also added: ‘So UK Finance is working closely with the government and the European Union to look at how to minimise disruption to firms and their customers. I gave evidence to the House of Commons Brexit Committee as part of an energetic programme of policy and advocacy work representing the interests of all types of UK Finance members including mortgage lenders.’
Going on to say: ‘We have proposed a credible model to ensure that the flow of financial services between the EU and UK can continue, including access to capital markets. And we continue to push for a transition deal that is certain so we have sufficient time to adapt to our relationship with the EU.’
With 365,000 first time buyers getting on the ladder last year, it was the highest for a decade. There are now almost nine million owner occupied homes in the UK with a mortgage. The market is strong and arears are at a historic low. All of which points to good news. But UK Finance is still watching the market for any further impact of the changes.
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