Some landlords have begun moving away from investment in ‘traditional’ buy to let properties following the April tax changes, instead favouring retail units and small commercial developments.
Master broker Clever Lending has reported a growing focus on commercial property opportunities, after many of the residential investment properties recently on the market have been purchased in the influx of sales prior to the tax reforms.
Commercial property tax reforms have led to a focus on small to medium sized investment opportunities. There is a 0 per cent band up to £150,000 and just 2 per cent above this to £250,000.
Rates on business and retail units were relaxed in the last budget, making them an appealing alternative option for investors. The business rate threshold has been increased to £15,000 and the top band will go up to £51,000 from April 2017. Through the cases Clever Lending has recently dealt with, it appears that becoming commercial landlords as opposed to solely residential properly investors is becoming an increasingly enticing option.
Sales and operations manager at Clever Lending, Sonny Gosai, said: ‘The Chancellor’s increases on buy-to-let taxation and the relaxation of tax on other property types has resulted in a shift of focus for the entrepreneurial landlord. Becoming a commercial landlord has some distinct advantages over the residential sector and it may not be that big a step if the property is a mix of retail and residential. Industrial and office units can also be acquired to grow a portfolio on terms that may be more beneficial with higher income and asset value. We’re still seeing the post-budget market evolve but the trends are starting to appear and it’s an exciting time in commercial bridging finance.’
Click here to view original article “Landlords Go Commercial”
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