2024 was quite a year for the buy and sell market. The latest UK finance figures show that although new purchase lending is up by 13%, it remains turbulent, albeit largely positive.
Landlords have become targets for governments of all colors in recent years, yet the rental market has remained incredibly resilient. 
A quick look back at the year: The average purchase interest rate at the beginning of the year was 5.4% and steadily declined as swap rates declined. These were held down by growing confidence in money markets in UK property and the stability of the UK economy.
This lower interest rate led to a significant increase in buy-sell financing, particularly in the second quarter of this year. Landlords and property investors seemed unfazed by the announcement of a general election in the pouring rain of mid-May. .
In the second quarter, buy-to-let lending surged 26% compared to the same period in 2023 as interest rates fell to an average of 5.19%. Buy-to-let foreclosures also increased, but these did not increase overall. , the legacy problem of 2022 and 2023, which I have been reading books about.
Despite the Conservative Tenancy Reform Bill being introduced in May, just five days before the general election, landlords continued to invest. This threatened to abolish guaranteed shorthold tenancies and strengthen Section 21's “no-fault” evictions. It also aimed to strengthen tenant rights, including limiting rent increases to once a year and giving tenants the right to request pets. This has caused anxiety among some landlords, particularly casual landlords and those who own only a few properties, who may struggle to comply with the new regulations.
Landlords and real estate investors seemed to be holding their breath as the wait time for a budget was incredibly long. The nearly four-month delay between the election and the budget has caused businesses across the country to suspend operations and wait to see what the impact will be.
The budget's impact on landlords was what most expected. There is an immediate 2% stamp duty surcharge on all property purchases classified as second homes or investment properties. This came into effect immediately after the budget was passed, increasing stamp duty from 3% to 5% for properties up to £250,000, and up to 17% for the highest value properties over £1.5m.
The Tenant Reform Bill is not dead either, it has simply been morphed into the Tenant Bill of Rights with many of the same amendments and an even tougher stance on Section 21 “no-fault” evictions. The reason for this is that homeowners may also be faced with regulations regarding energy performance certificates, and there is also a need to improve the energy efficiency of their properties.
So what can we learn from 2024? The old Greek adage that the only constant in life is change has been embodied this year in the form of changes in governments, interest rates, and regulations.
But one thing that hasn't changed is the need for quality rental accommodation. Since the public sector cannot meet the needs of everyone who needs to rent, it is up to the private rental sector to meet this need.
Homeowners have proven to be incredibly resilient to everything thrown at them. But perhaps what those in power lack recognition is how important private landlords are in providing housing to people who need it because they cannot or choose not to buy.
There is always room for improvement in all areas, but the rights of renters must be balanced against the rights of those investing funds to provide the housing. At the moment, large landowners have the ability to absorb a lot of change, but we don't want to displace some small landowners. Those with fewer homes also play an important role, often providing high-quality accommodation at low rents.
The biggest lesson we can learn from 2024 is that markets are dynamic. We can absorb change, but let's also support landlords who are providing needed quality housing to underserved sectors of society.
Matt Kimber is CEO of Molo Finance
