The former software developer is selling his first buy-to-let property, a three-bedroom house in Cheltenham that he bought for £75,000 in 1997. His tenants are now taking it off his hands for just under half a million pounds, resulting in a profit of £415,000.
He bought the house with money he had received from his employer in case he wanted to lease a car. “I figured I’d rather spend it on a car than on a piece of real estate,” he says. After he renovated the house, it quickly began to provide a “nice income” to supplement his and his wife, Allison’s, salaries.
By 2015, he had built up a portfolio of four buy-to-let properties and become one of millions of buy-to-let investors across the country who enjoyed tax-advantaged income from renters as the rental market boomed. There were 4.6 million private renters in England in 2022/23, a 130% increase since 1996, according to the English Housing Survey.
But now investors have slowed down their purchases and are selling. Rightmove found that 18% of homes on the market were previously available to rent, a record high.
According to research by Hamptons, landlords bought 10% of homes sold in the UK in the first half of this year. This is the lowest percentage since records began in 2010. It is significantly lower than the 16% of homes bought by landlords in 2015.
Storey stopped investing in buy-to-lets in 2015 and decided to sell his first home in 2019 following the introduction of the phasing out of mortgage interest relief. He also claimed his profits had halved following the mini-budget debacle in October 2022, when interest rates on his mortgages rose from 1.5% to 5.4%.
After selling his Cheltenham property, he hopes to sell his remaining two properties, but acknowledges that this is unlikely to happen until the government has implemented any tax increases.
If tax thresholds rise next month, he could face a loss of capital gains on both properties.
If the Chancellor does raise capital gains tax in the Budget, Storey believes it will only be to ‘play’ Labour voters ‘to show they are taxing the rich’. He adds: ‘That is what they see as capital gains and it is an easy win. But it is a very complicated issue and it can affect a lot of people.
“It’s hard to understand a lot of what Labour is doing at the moment. I just find it a bit annoying that we’ve worked to achieve something and they can take it away from you at the stroke of a pen. It’s annoying.”