2010 budget doesn't take private rented sector into account

Landlord Expert
By Landlord Expert March 26, 2010 09:49

David Brown, commercial director of LSL Property Services, states: "Removal of stamp duty tax for first-time buyers is positive news for the housing market, but the unsung cornerstone - the private rental sector - has once again been overlooked."

He suggests that the majority of buy-to-let properties fall under the £250,000 threshold and therefore the stamp duty tax break should be extended to landlords.

Mr Brown says he feels that this would encourage more people to invest in the sector, which will help to meet the UK's housing needs.

According to the British Property Federation, private landlords are the only way to fill the housing gap in the UK, which has resulted from a lack of affordable, good-quality homes.

The budget overview

Chancellor Alistair Darling is today expected to announce that stamp duty will be ditched on home purchases up to £250,000 for first-time buyers. The news will go down well with the property industry, as stamp duty appears to be top of the housing agenda for most professionals working in the property business, according to What House? research.

Affordable housing, Home Information Packs (HIP's), mortgages and capital gains tax also need to be addressed. Here are a few of the comments gathered by What House? this morning:

James Wyatt of Barton Wyatt estate agency comments:

"Stamp duty of 1% at £125,000 is a huge barrier to entry into the housing market for first time buyers - it needs pushing up to £250,000.

"Residential property needs encouragement from central government. It is in a delicate state. Trading costs are too high - stamp duty at 4% over £500,000 is punitive for many. This threshold should be increased to £1m and the other stamp duty thresholds need to be moved also.

"HIP's have proved to be a waste of time and money. Make them voluntary or scrap them preferably. EPC's [Energy Performance Certificate] will have to stay."

"Lettings - Landlords are selling up where possible - this will lead to a lack of stock eventually. Create a more attractive environment for Landlords.

"Capital Gains Tax is oo high...should be abolished when rolling over to another property . Banks need to be encouraged to lend at un-inflated rates.

"Given to dreadful state of UK's finances, we can't hope for much frankly, but this Government has slowly strangled the property market as the market got hotter and hotter. It now needs to release its grip from our throats so we can breathe again and operate in a profitable way."

Tracy Kellett of BDI Home Finders says:

"I am hoping for stamp duty to be halted for first time buyers and more affordable housing schemes to make home ownership accessible to people on modest incomes."

Tim Hawe, head of property sales at George F White's Alnwick office, says:

"The key issue for house buyers in the current climate is the ability access lending. Figures and our experience show that there is a huge demand for property that is being frustrated because responsible people do not have access to appropriate levels of finance. I am hopeful that the chancellor will recognise this and seek to encourage lending to buyers and developers in ways that will allow them to buy and drive the property market forward."

Danny Williams, estate agent and founder of new online property marketing agency One London Property, says:

"What I would like above all else is an end to the smudging of market statistics and 'creative reporting' on the state of the economy and the housing market in particular.

"We need a clear, transparent statement of account together with clear, transparent proposals for taking things forward. I do not believe anybody, individually or as part of a singular body, currently possesses all of the necessary resources and experience to project and/or predict the future, what we need is a collective forum on what is most likely to bring steady growth back to the sector.

"We need policies that encourage and incentivise, not homeownership at any cost, but prudent homeownership.

"All parties involved, whether housebuilders, mortgage providers, estate agents, surveyors, solicitors and everyone else involved in the process must pool their collective resources and stop acting purely in the sole interest of their industry or service. This co-operative, concerted effort would organically build confidence and buyers and sellers will be able to make informed decisions rather than choices based on inaccurate information."

Kate Faulkner of Designs on Property compiled her own wish list for today's Budget:

"No stamp duty for 'true' first time buyers. This would be for people who have never owned a property before as opposed to someone dropping out the market and then coming back in.

"Some incentives for Landlords. For example, VAT at 5% for renovation or energy efficiency work.

"Increased incentives for landlords who have owned and operated for 5+ years, such as being able to reinvest money in other property rather than pay capital gains when they sell a property.

"Support for people/investors buying new build property as it is more energy efficient. For example, only pay half the stamp duty rate.

"Support for people self building in rural areas, such as lower cost land, less stamp duty, tax incentives.

"More money for genuinely affordable homes for first time buyers and lower income families in highly priced areas such as London.

"More money to upgrade social housing - some of the properties were in an appalling state on the C4 programme where MP's lived in the tower blocks. Any private landlord would be hauled over the coals.

"Incentives to 'bring back' empty homes to life, such as a payment plan to sell them back to local authorities or an organisation that negotiates and sorts all the renovation required and manages the properties on-going."

Landlord Expert
By Landlord Expert March 26, 2010 09:49

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