UK landlords are having a hard go of it. First, they faced a set of tax changes — announced in 2015 and implemented beginning this year — and now they’re facing a set of new regulations which threaten to cut them off from lenders.
The Bank of England’s Prudential Regulation Authority is preparing to implement new regulations that will make loans harder to obtain for UK individual landlords with more than four properties, according to The Telegraph. (The change does not apply to landlords who operate through a limited company.)
As of October 1, the new regulations will mean landlords’ entire portfolio will be assessed instead of the singular property for which the owner is seeking funds. For both the landlords and banks, loans will require a lot more additional work, which could make some banks stop lending to landlords who have to follow the new regulations.
Santander, one of the largest lenders in the UK, has declared it will no longer issue loads to affected landlords. If other banks follow suit, higher fees and interest rates are likely, according to brokers The Telegraph surveyed.
The new regulations amid the spate of ongoing changes to landlords’ taxes resulted in the UK being declared one of the worst EU countries for landlords, lower than even lower than Greece and Italy, by international experts who examined government data.
[The Telegraph] — E.K Hudson