Regulation tops
most landlords’
list of concerns
for 2010,
research from
Paragon
Mortgages has revealed. Nearly six
out of 10 (58 per cent) landlords
said that they were worried about
the level of regulation required in
relation to the running of their
property business during the year.
Landlords are already heavily
regulated with an estimated 50
Acts of Parliament and 70 sets of
regulations governing the PRS, but
more could be on the way.
The Government has recently
concluded its consultation on the
launch of a national mandatory
registration scheme for landlords
and will soon report its findings.
In addition, HM Treasury is
currently consulting on whether
the FSA remit should be extended
to regulate the buy-to-let sector.
This is likely to tighten buy-to-let
product availability and increase
the cost of mortgages, which will
have a knock-on for residential
property investors and tenants.
John Heron (pictured), MD,
Paragon Mortgages said, “It is not
surprising that regulation tops the
list of landlords’ concerns for the
year. They already have to comply
with a myriad of regulations, which
seem to be regularly added to or
amended by the Government.
Several new statutes have been
introduced in recent years,
including EPCs, tenancy deposit
protection and HMO licensing.
“But regulation can also impact
landlords indirectly. For example,
if the FSA is given the power to
regulate the buy-to-let market,
then buy-to-let mortgage
availability may decline and it
could become more expensive to
borrow. Any extra costs are likely
to be passed on to the ultimate
end user – the tenant – and could
price the private rented sector out
of the reach of some households.”
With buy-to-let lending levels
subdued and mortgage product
availability limited, 37 per cent of
landlords also expressed concerns
about how they will fund property
purchases in 2010.
The buy-to-let sector is marked
by a lack of competition, with just
two lenders accounting for an
estimated three quarters of current
new business. Other concerns
included retaining tenants
(32 per cent), finding tenants
(31 per cent), tenant disputes
(24 per cent), and meeting
mortgage payments (12 per cent).
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