The fact is that future prospects for buying-to-allowing most are in the hands of politicians. Not because they might apply criminal tax allegations to landlords as feared by eliminating the ability for landlords to compensate for interest on their purchase loans to their rental income with business profit rental; Or even by continuing with the introduction of a less frequent bureaucracy such as a rental deposit or home scheme in licensing some work (HMO).
No, the main impact that politicians will have in a few months and the coming year is their approach to immigration.
Immigration key to buy purchase prospects
There is no doubt that immigration has made a major contribution to the British economy, at least to have this seen in the British housing sector.
New immigrant skills are very important in maintaining the level of development in electricians in south east London the UK for the past few years. The lack of skilled, electricity, etc. will do many things to resist the construction of new homes that facilitate more shortcomings and add further to the inflation rate of high home prices.
However, the dilemma for policy makers and politicians is that these skilled workers need housing & all potential tenants or homeowners. Therefore they themselves also add pressure on accommodation. The latest numbers produced by the government have shown that they have underestimated the number of foreign workers in the UK; Now it is placed at 1.1 million or between 7-8% of British workers.
For many landlords, demand for leasing accommodation from these workers who are often high-quality have become ‘godsend’ and encourage many landlords to expand their portfolio behind it.
Latest housing projection
The latest population projections published by ONS (National Statistics Office) have revised the estimated advantage of net immigration from 145,000 to 190,000. The current forecast is that the British population will increase to 65 million in 2016 & then 71 million in 2031; Leap 10.5 million at the current level. This further questioned the ability of British home builders to provide sufficient number of residence to accommodate the increasing demand. The existing projections for the construction of houses before the revised population showed that they would continue to be a lack of housing every year around 33,000 residences.
Gordon Brown recently stated that by 2020 3 million new homes will be built.
The reality for landlords and the government is that private home builders have the grip of housing supply. This is because they have or control a large amount of limited development land needed to build these houses and potential housing investment property. After massive housing depression in the late 80s and the early 90’s when many home builders only avoid bust. Home builders have learned their lessons from this and now only build when they are sure to make adequate returns. Added to this is an increasingly stringent planning system that makes the release of land development more time and expensive than before, limiting the release of potential development of land. This means that when Gordon said 3 million houses will be built in 2020 we can take this with all the same certainty as if I would announce to the world; “I will be the next British queen The good news for landlords and property investors is that unless politicians turn off immigration waves quickly, lack of housing and the increase in house prices seems to be guaranteed.