December 2016

Taj Kang gives you the latest update to contractor mortgages with this December Vlog. Highlighting changes to Buy to Lets, the Base Rate decision, and what has happened this year - from the referendum and the change to our political landscape. 


Hello and welcome to my blog, which as it turns out is the last blog of 2016. What a year we have had so far in 2016, and it’s not over yet, we still have one more base rate decision to go on the 15th December.

If we just have a look back at 2016, and what the year promised, and what it actually delivered, I think you will find there’s a significant gap between those two. We knew there would be a referendum in 2016, but the year started, if you’re a contractor who owns properties outside your own home, had a bit of a bashing for landlords.

So there was no longer the promise of mortgage interest being an offsetable expense in Buy to Let investments. So in a way, not a great start for contractors.

We then went to the referendum, and who would have thought we would of voted to exit Europe? Well that’s what happened, and the knock on effect was our Conservative Government had a change at the top as well, with David Cameron and the Chancellor George Osborne exiting. We also had new people coming in, Theresa May, who was remarkabley silent around her decision on Europe during the referendum campaign.

But since she has come in, it’s fair to say she has been very forthright in her views around how the exit from Europe should look, and the knock on impact obviously on all of us in the United Kingdom that is likely to bring.

She brought in the slightly more reserved Philip Hammond, who just recently delivered his first, and last, Autumn Statement, his promise is that there will be no more Autumn statements, but a budget in the Autumn instead now. So there is a change of sorts, but not a great deal to write home about in terms of what he mentioned in the budget.

Positive for contractors looking to buy their new homes in 2017, particularly if you are first time buyers, as he has promised to keep 2/3’s of the Help to Buy scheme going. The only bit that is going to disappear is the Mortgage Guarantee scheme, which was largely not taken up as much as it was towards the start anyway.

So those of you who are looking to buy shared ownership, and Help to Buy properties as first time buyers, there promises to be more housing stock out there for you, particularly with the invest in infrastructure for the areas that need the most homes in the UK.

So 2017 promises to be a very interesting one, new administration in the United Kingdom, also a new one in the United States. Well what will that do for opportunities for contractors in the labour market?

What will it do for those who are looking to purchase their homes and mortgage availability?

A sign the way things may be in 2017, and way they may start, is news that one of the lowest Fixed Rate mortgages in the United Kingdom from HSBC has been withdrawn. That’s likely to cause a knock on effect from other lenders, so we may be seeing the end of the record low prices around mortgages.

Watch this space and I’ll give you a further update in January. I’d like to wish you all an extremely Merry Christmas and a Happy New Year, and I look forward to speaking with you early in 2017.