It is early days regarding the election, and all the promises from the UK political parties are still coming out daily.
But we take an early look at what each party offers or doesn’t offer for you as a property investor.
Either way, it is likely that whoever is in power will edge on the side of renters over landlords, as unfortunately, renters make up more voters than landlords. However, election promises are only that, and when it comes to making the hard choices, all parties have a reputation for failing to deliver on their promises.
Labour
Labour is not the best option for investors. Here’s why: Currently, they are indicating:
- Abolishment of Section 21: Making it harder for you as a landlord to evict tenants.
- Rent Stabilization: This will make it harder for you to increase your rent. It may affect different areas differently, as it would be based on the average local income.
- Incentives to Discourage Short-Term Lets: Measures to discourage landlords from moving to short-term lets.
- National Landlords Register Fees: Landlords would have to pay to use the National Landlords Register, adding to the costs of running a profitable property.
- Rent Rise Restrictions: Including several restrictions such as annual rent increases only with four months’ notice.
With all these changes favoring tenants over landlords, which is typical of Labour, it is likely landlords will sell up. However, this could lead to a temporary decrease in property prices. Eventually, this might provide cheaper investment options, which may be a blessing in disguise for first-time investors looking to make their first purchase as advantageous as possible.
Conservatives
Conservatives are not a clear choice over Labour, but may be the better choice:
- Landlords’ Party: Although Conservatives have traditionally been the landlords’ party, with pressure for change and more center-left MPs, they may be forced to make choices in favor of renters rather than landlords.
It is still difficult to know where Conservatives will stand for landlords. Considering Labour is pro-renters, and the Lib Dems and Green Party are even more so, Conservatives are still the lesser of the evils for landlords.
If still in power, it is likely that Conservatives will keep changes regarding property and real estate reforms/legislation minimal, or at least less significant compared to Labour or any other party.
All of the above is mostly based on our own thoughts on the matter. In truth, no one can predict what all these changes will mean for the property market.
Renting is still a key part of the UK economy, and landlords remain essential to how the UK runs, so there will always be a way for landlords to make a profitable business from renting. It is now more important than ever to use a property consultant to help you navigate all these potential changes.
