Today will see two of buy-to-let landlord Jamie Brewis’s tenants – a couple in their 60s – having to move out of the bungalow that has been their home for the past four or so years. They didn’t want to go, and were good tenants. But Brewis says he had no choice but to give them notice, thereby forcing them to find somewhere else to live, because of major tax changes being phased in from this Thursday.
Brewis says he has decided to sell the property because the cut in tax relief on mortgage interest payments for buy-to-let landlords means that in this particular case the maths no longer stack up, and he would end up making a net loss. With what he is paying on the mortgage, against the rent he receives, he says the result will be that “I am not earning anything out of it – in fact, it’s costing me money.”
Brewis says the couple are upset, and he is, too. “I don’t want to chuck them out – they are in their 60s, they have lived their life in rental, and they are now not in a position to buy somewhere. I provide housing for a lot of people and I don’t charge them over and above market rent – I charge them market rent. If market rents don’t work because of these government changes, I’ve got no choice but to sell up and move on.”
The 38-year-old runs his own property development company, Haverbridge Homes, and outside his business he has personally invested in 21 buy-to-lets in and around Upminster, east London. He is also selling another of his higher-end properties, though the tenants living in it aren’t moving out for a couple of months because they recently had a baby. They and the older couple won’t be the only people affected by the changes – industry surveys suggest a fair number of landlords have already started offloading properties, or are thinking of doing so.