56% of Shawbrook Bank clients are planning on purchasing a buy-to-let property within the next 12 months, according to the lender’s Client Barometer, a survey of over 170 property investors.
The survey captured the mood in the market amongst Shawbrook clients and detailed their main challenges and expectations for 2016.
With changes in tax approaching, Shawbrook found that 40% plan to set up a limited company for their properties to counter the impact of tax changes, while 33% plan to raise rents.
While the outlook for investors remains positive, new changes to tax relief and stamp duty have caused some investors to check their ambitions. Of the 44% who are not planning on purchasing a new buy-to-let property this year, 37% said it was due to the 20% cap on tax relief for buy-to-let properties making the proposition unattractive, while 16% said the 3% extra stamp duty levy on second homes and buy-to-lets was putting them off.
The latest figures also revealed that 49% of clients said they considered regulation to be the biggest challenge facing property investors over the next six months, a significant increase on last year’s Barometer results, which found that regulation was something only 23% of investors considered to be the biggest challenge they faced.
61% however have a positive outlook for the upcoming 12 months, predicting either a large or small increase in property value. In total 43% of landlords saw an increase in tenant demand in 2015 and 61% saw an increase in their rental income. A further 44% are confident that their business will grow in 2016.
Karen Bennett, sales and marketing director for commercial mortgages at Shawbrook Bank, said: “As a lender it is always great to see such positivity in the market, and as with our Broker Barometer conducted in late 2015, it seems that there is a lot of optimism amongst property professionals also.
“Obviously the new changes will have an effect and may instil more caution across the market; however, Shawbrook is well-placed to adapt to change, and we are expecting the market to remain buoyant.”