Property better investment than money in the bank!
From a property investor’s perspective, it has been a tough year following a raft of changes introduced by the government.
Aside from the introduction of the stamp duty surcharge in April, the 10% Wear and Tear tax relief for those investing in the buy-to-let market has been abolished, leaving them free to only claim for the amount that they have spent, while mortgage tax relief is set to be phased out from next year.
In addition, the Bank of England’s Financial Policy Committee is being granted greater powers over the buy-to-let market, which could make it even harder to get a mortgage.
So whilst investing in property has long been perceived to be a safe alternative to the failing of the pensions industry, the reality is that for some investors it suddenly looks like a far less attractive proposition.
Various reports suggest that many property investors, especially buy-to-let landlords, plan to sell up in the coming months. But before they do, it is essential that they find other ways of growing their money, rather than leave their cash in the bank.
As far as the savings market is concerned, 2016 has been a total wipe-out, with the latest research from Moneyfacts.co.uk showing the significant difference in the amount of interest on offer today compared to previous years, and how much savers are losing out on.
In fact, some of the top rates five years ago paid three times as much interest, showing just how far the rates have fallen.
Rachel Springall, finance expert at Moneyfacts.co.uk, said: “Consumers might have the best intentions to save, but the sad truth is that there is little incentive for them to put money aside due to the poor rates on offer.”