Three things agents need to consider in 2017
18 January 2017 3853 Views
2016 was quite a year – eventful, dramatic, shocking and impossible to predict. In no particular order, we saw Leicester winning the Premier League, Brexit, Trump, Theresa May as the new PM and a number of sweeping changes to the property industry.
While 2017 promises to be much calmer, there are still certain things that agents need to be on the lookout for.
Ban on letting agents' fees to tenants
A surprise announcement in Philip Hammond's first Autumn Statement, it was revealed that upfront letting agents' fees to tenants will be banned, after considerable opposition from campaign groups, politicians and peers. There is set to be a consultation period in the first few months of this year, with industry bodies and other interested parties arguing their case, but it is highly unlikely that the government will row back on their proposals.
While the ban might be weathered down slightly to appease landlords and letting agents, there is no guarantee of this. As such, those set to be affected by the ban would be wise to make contingency plans.
Phasing out of mortgage interest tax relief
Last April was a very busy time for the property industry, and April 2017 is set to follow suit. The biggest change coming into play is the phasing out of mortgage interest tax relief, fully completed by April 2020, which will mean that buy-to-let landlords can no longer claim tax relief on their mortgage interest payments at their marginal rate of tax. Rather, all landlords will have to claim tax relief at the basic rate (currently 20%), regardless of the tax bracket they sit in.
Many fear that landlords' profits will be severely hit as a result. The months leading up to the change are expected to be busy for letting agents in particular, as landlords seek assurances about the new rules and look for ways to avoid being hit too hard.
This could include switching to a lower fixed-rate mortgage deal, placing a property portfolio into a limited company (therefore paying a lower corporation tax and lower tax on profits) or a landlord transferring ownership of one or more of their properties to their partner, if that partner currently pays less tax.
Much of this is quite complicated, and will require the expert advice and support of an experienced agent, to ensure buy-to-let landlords can cope with the latest government legislation.
The start of Crossrail
The long-awaited arrival of London's newest, shiniest bit of transport infrastructure is pencilled in for May 2017, when the eastern section of the Elizabeth Line (as it will be known) starts operating. Services will run from Liverpool Street, a key City transport hub, to commuter suburb Shenfield in Essex.
The Crossrail effect – regeneration, improvements, rising house prices and rents, increased demand from commuters, etc – has been seen for a number of years, but it will be expected to ramp up even further as the line slowly but surely becomes fully operational.
Estate and letting agents operating in areas with, or close to, a Crossrail connection may find themselves extra busy across the next few years, as sellers look to cash in on increased demand from buyers. Landlords, meanwhile, will be looking to invest in areas where tenant demand is particularly high.
As we can see from the above, the first half of 2017 is expected to be fairly busy and frantic.
Consequently, your business needs to run more seamlessly than ever before. You need your clients to be in-the-know and contented, you need a fast, responsive, user-friendly website, and you need services that look as good on mobile and tablets as they do on traditional desktops.
What's more, you need to keep on top of your hectic schedule and ensure you are not overwhelmed by your busy diary.
At Gnomen we can help with all of this. Our aim is to provide cutting-edge, all-in-one software that makes the job of an estate agent, letting agent or property manager ten times easier and smoother.
Our services work in complete harmony, making sure that customers are kept informed and engaged and social media platforms are regularly updated in a timely, hassle-free way.
We operate a cloud-based system that allows you to manage your staff, workload, diary, office, customers and multi-channel marketing in one place, at the same time. This allows agents to stay on top of the important things like call-backs, valuations and instructions, while our integrated office accounting system means you will always be aware of the bottom line.
If that wasn't enough, we also design beautiful estate and letting agent websites. Our motto is “websites that look beautiful and work beautifully”.
To keep ahead of the competition, check out what Gnomen can do for you by booking a free demo.
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