A lot is changing for landlords in 2018, some of which is already underway. In this short report we have highlighted some of the important points to be aware of.
Tax relief reduced
As is now commonly known tax relief on mortgage interest payments will continue to be tapered down. This means the amount of mortgage interest payments allowed to be offset against income will continue to reduce.
HMO Licence
There is expectation that the Government is looking to pursue rogue landlords with new tougher rules on houses in multiple occupation (HMOs).
Under the current rules all large HMOs require a licence. The changes could extend to many more HMOs, removing the three-storey minimum rule on what obligates an HMO for the licence requirement. HMOs of five or more people, irrespective of the number of storeys, could then need a licence.
Credit Reports
The Rent Recognition Challenge starts this month and will run until October 2018 with a view to getting technology firms to record rental payments as part of credit history.
Such a change is thought to help people get a mortgage and also benefit landlords as they will have greater visibility as to whether prospective tenants have paid timely rent in the past.
Energy Efficiencies
New rules arrived on 1 April 2018 which mean that all new tenancies need to meet the Minimum Energy Efficiency Standard (MEES).
It will be illegal to let out a property with an Energy Performance Certificate (EPC) rating that is lower than an E. Steps need to be taken to review the EPC rating of your property and amend if required.
Rogue Landlords
A database of rogue landlords and letting agents is expected to go live in April 2018. It has been delayed from October 2017, but hopefully it will appear in the spring.
Only Local and Central Government will have access to the database when it is launched and it will include those with criminal convictions and any landlords or letting agents who have been issued with banning orders for a range of offences.
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