The commercial mortgage and bridging finance sector is calling for significant planning reforms and increased support for landlords from the next Prime Minister. TAB, a commercial mortgage and bridging lender, highlights that current planning delays and tax policies are hindering investment in regeneration projects and housing supply, which is important for economic growth.
TL;DR: TAB emphasizes the need for urgent planning reforms to expedite development; landlords are urged to receive more support as they play a vital role in addressing housing demand.
What Planning Reforms Does TAB Propose?
Karen Rodrigues, sales director at TAB, stresses that the next Prime Minister must prioritize a refreshed planning system. Key proposals include establishing statutory deadlines for planning approvals, enhancing local authority resources, and promoting the conversion of redundant commercial spaces into mixed-use developments. These changes aim to speed up the approval process for change-of-use applications, which currently face significant delays.
Rodrigues points out that while TAB is capable of delivering commercial mortgages swiftly, the sluggish planning system hampers progress for businesses and investors. By reforming planning regulations, the government could unlock various projects, stimulate community regeneration, and ultimately support broader economic growth.
How Will This Impact Landlords and Investors?
Landlords are a critical component of the UK housing market, particularly in the private rented sector (PRS). TAB argues that the next government must recognize the importance of landlords in meeting housing demand, especially as social housing delivery lags behind. Rodrigues calls for the removal of excessive red tape and fiscal burdens that have historically targeted private landlords.
Among the suggested reforms are the reinstatement of mortgage interest tax relief for individual landlords, the elimination of the stamp duty surcharge, and the reintroduction of the Wear and Tear Allowance. These measures would alleviate financial pressures on landlords, encouraging them to invest in their properties and contribute to the housing supply.
What Changes Are Needed for Business Rates?
Business rates reform is another area highlighted by TAB, with Rodrigues advocating for reduced costs for independent retailers and hospitality businesses. Lowering business rates could significantly benefit high streets and support tenants in semi-commercial properties, enhancing the viability of local businesses.
Rodrigues emphasizes that the next Prime Minister should create conditions that allow local businesses to thrive, which would, in turn, rejuvenate high streets. This includes potential reforms to stamp duty, such as lower rates on commercial and mixed-use acquisitions or reliefs for bringing vacant buildings back into use. The current tax market often discourages sensible deals, making it essential to address these issues to stimulate activity in the property market.
What This Means for Bridging Finance
For those involved in bridging finance, the proposed reforms could lead to increased opportunities for investment and development. A more efficient planning system would allow bridging finance providers to facilitate quicker transactions, ultimately benefiting borrowers and investors alike. With the right support and reforms in place, the bridging finance sector could play a pivotal role in addressing the UK’s housing challenges.
Frequently asked questions
What is bridging finance?
Bridging finance is a short-term loan used to bridge the gap between the purchase of a new property and the sale of an existing one. It is often used in property transactions where quick access to funds is necessary.
How can planning reforms benefit property investors?
Planning reforms can streamline the approval process for property developments, reduce delays, and create a more favorable environment for investment, ultimately leading to increased housing supply and regeneration opportunities.