Landlords are facing uncertainty around the future of the eviction process and the effects of COVID-19 and Brexit on property investment, meaning 2021 could be a tricky year for the buy-to-let sector.
It's a complex time to be a landlord, but Which? can help you get your head around the various regulations you'll need to be aware of when investing in buy-to-let and managing your portfolio.
Here are our 13 top tips on what to watch out for this year.
In late 2019, the government consulted on abolishing Section 21 - a clause which allows landlords to end 'rolling' tenancies with two months' notice without giving a reason for doing so.
More than a year on, Section 21 remains in place, with the Renters' Reform Bill having been delayed for an indefinite period due to the COVID-19 pandemic.
It's possible we could see some movement on the bill this year, so landlords will need to keep their eyes peeled.
Other proposals featured on the bill include replacing security deposits with a 'lifetime deposit' that moves with the tenant, and making the rogue landlord database publicly available.
If you're struggling to pay your mortgage or your tenant is having problems paying their rent due to COVID-19, you can apply for a payment holiday on your mortgage until 31 March.
The rules are as follows:
From 1 April, overseas buyers will need to pay a 2% stamp duty surcharge when they purchase properties in England and Northern Ireland. This is on top of the regular buy-to-let surcharge.
The rules apply to all non-UK residents. To be classified as a UK resident, you'll need to have spent at least 183 days (six months) in the UK in the year before or the year after you buy the property.
With the finer details of the deal yet to be applied in practice, there could be some further bumps in the road.
Currently, landlords need to check all tenants have the right to live in the UK before letting them move in to a property, but this could change in 2021.
Landlords have been encouraged to use the current system of accepting passports and photo identification cards until 30 June, but it's unclear how Right to Rent will work after this date.
Some self-employed workers who owe less than £30,000 in tax can qualify to spread the cost of their bill using the government's Time to Pay scheme.
The government is currently reviewing these recommendations. It's unlikely any wholesale changes will happen soon, but this is one to keep an eye on in 2021.
Mortgage interest tax relief is a sensitive subject for landlords, and we're now coming to the sharp end of the changes that have been phased in over the last few years.
When you file your 2019-20 tax return in January, you'll be able to deduct 25% of your mortgage interest and get a 20% credit on the remaining 75%.
But from your next tax return (due in January 2022 for the 2020-21 tax year), you'll instead just get the 20% credit on all your mortgage interest.
Agents must sign up to one of the government's six approved schemes and hold money in accounts registered with the Financial Conduct Authority.
Those who fail to join a scheme could face fines of up to £30,000.
New electrical safety rules mean landlords will need to ensure all electrical installations in their property are inspected and tested every five years.
Tenants must be provided with a copy of the test report within 28 days (or before occupation for new tenants). The report must also must be made available to your local council if requested.
New tenancies have been subject to the rules since 1 July, but from 1 April 2021 existing tenancies will need to follow the regulations too.
From February, all homes in Scotland must have a smoke alarm in living rooms, hallways and landings.
In addition, you must have a heat alarm in the kitchen and a carbon monoxide alarm near any boilers or wood burners.