Buy to Let Boom in UK & Spain
By Sue Brown, 22 Dec 2005
Buy-to-let mortgages increased by a massive 16% in November, according to lender Mortgages Direct, the financial subsidiary of Spicerhaart.
The rise followed a steady increase over the past six months as many investors were gearing themselves up for the tax-free residential property investment opportunities in Sipps. This has now been snubbed out by the government, as the chancellor scrapped the tax break.
Peter Gladdy, director of Mortgages Direct said: "The original proposed changes to Sipps, where residential property was to become a valid Sipp investment had already boosted the number of buy to let mortgages, as investors were realising the opportunities to boost their pension funds."
"The government’s u-turn on Sipps in the pre budget report is clearly bad news for pension holders who were planning on feathering their retirement nest with tax-free residential property."
Alberto Linares of MortgagesInSpain said: “The steady interest in buying a property in Spain is being maintained as people are deciding to forgo the false promises of the UK Government and buy without the SIPPs tax breaks they expected. They now realise they can buy with a lot more freedom than might have been possible with SIPPs property purchases.
“We expect 2006 will be the year of the serious buyer as people switch their money, allocated to the new SIPPs, into a home they can buy and sell when they want, rent out and use when they want – without the restrictions of redefined SIPPs rules.”
Spanish Property News