The government should aim to stimulate housing market activity post-lockdown by abolishing the 3% stamp duty surcharge for buy-to-let landlords buying additional properties, according to Mary-Anne Bowring, managing director at Ringley Group.
Bowling argues that scrapping the stamp duty surcharge would encourage buy-to-let investors to return to the rental market to help meet the rising demand for rental homes and drive transaction levels.
Additional regulation, higher stamp duty and reduced mortgage relief have led to many buy-to-let investors exiting the rental market, with the number of private landlords hitting a seven-year low in 2019, data from Hamptons International shows.
However, Bowling, like many professionals working in the letting sector, expects to see the disruption and uncertainty caused by COVID-19 cause a spike in rental demand once the existing lockdown measures are eased, as households put off major financial decisions such as buying a home and opt to rent for longer, underlining the need for more rental homes.
She said: “A stamp duty holiday would no doubt cause a rush of transactions and help breathe life into a housing market that has been put into deep freeze in an effort to battle coronavirus.
“The government should be looking at long-term solutions as well as short-term sticking plasters when it comes to fixing the UK housing market.
“Millions of Brits were already renting, and that number was predicted to grow anyway with or without coronavirus. The disruption caused by coronavirus will likely see rental demand grow, as banks squeeze potential buyers with tighter lending restrictions and people put off buying or selling a home as it becomes clearer Covid-19 will cause continued uncertainty and disruption in the medium term.
“Eliminating additional stamp duty for buy-to-let investors would help stimulate the supply of rental homes while also driving wider activity in the housing market. Landlords are a crucial source of development finance through off-plan sales and will help support getting Britain building again.”
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A Stamp Duty holiday for second-home owners - i.e. landlords? Oh dear. Really not the best suggestion when millions of people have just lost their jobs and their shops and business are losing money. Please look at the wider picture and think again at this time of national emergency, whoever came up with that idea …... The housing market will in time revive
second home owners are not the same as Landlords. The former reduce housing stock as they only part-time occupy two (or more) properties, whereas Landlords make a hoe available for those unable to buy, do not want to buy or not in a position to buy with a home, so does not reduce the housing stock.
If anything there is going to be an increased demand in the coming months for properties to rent - who is going to provide those houses?
No need to worry there David we all know it will never happen, however it has to be remembered that extra costs forced onto landlords doesn't make landlords poorer, it just makes tenants poorer.
I would much prefer homeownership made far easier.
As it isn't we LL are unjustifiably attacked by everyone.
Though it must be remembered that if it wasn't for LL property prices would be far higher and there would be a much reduced rental supply and also of properties that OO buy.
LL through their acumen are responsible for funding most new-build developments and bring to market much supply that no FTB would ever wish to buy.
It is LL that sort out the 'awkward squad' properties and rejuvenate them for rental occupation.
This clueless idiot managing director needs to learn what the property market is all about.
It must have escaped her attention that since 2015 the Tories via their bonkers and penal anti-LL policies have sought the eradication of the small LL.
The SDLT surcharge was just one of these bonkers policies.
Govt is hardly going to remove a policy which would see an increase in more rental property.
Govt is not the slightest bit interested at all in where tenants might live if there were fewer rental properties available.
It just hopes its big buddy corporate LL will bring sufficient supply to the market.
Consequently the Tories are doing everything they can to give advantage to the corporates by coming up with as many disincentives for the small private LL as they can think of.
They want to eradicate the small LL NOT encourage him!!
I would say that since 2015 they are doing a pretty good job in that eradication as indeed many LL are selling up or downsizing the numbers of rental properties they have.
Surely this stupid director has been aware of what has been going on in the PRS since 2015!!??
2015 being the start of the bonkers LL eradication policies with S24 being announced.
There is simply no way that Govt will do anything to assist small private LL to bring more supply to market.
Small LL have got well above their station and need to be put back in their box..
Can't have the hoi poloi making money out of property.
That is reserved for their alleged betters!!!
I don't believe the PTB realised Pandora's Box was opened with the advent of the BTL mortgage.
No longer for the rich property investment was made possible for the man in the street who could be bothered to save up a decent deposit or acquire one.
Obviously feckless aspirant FTB never bothered saving for a deposit so they ended up as the tenants of those who did.
Personally I would incentivise FTB.
So first thing would be to abolish MMR.
Allow IO residential mortgages with a term of 70 years from age 18 with NO repayment vehicle required beyond that of selling the property to redeem the mortgage.
Also 95% residential borrowing to be allowed.
I would abolish SDLT for all buyers of property up to the value of £500000 and would index link it to avoid fiscal drag.
However I would also introduce a maximum 50% LTV for all BTL and LTB mortgages but would abolish S24.
That would massively constrain how many properties LL could buy.
Making these changes would be politically massively appealing.
I also believe MIRAS should be introduced.
Home ownership is something to be encouraged.
It is residential lending criteria which forces many to become tenants.
Converting tenants to homeowners is something I would greatly welcome.
Such homeownership is a great driver of GDP.
If Govt wishes to remain electable it needs to incentivise OO.
Changing lender criteria is the first thing to do.
If that meant less demand for rental property I would be perfectly content with that.
There will still be a need for a PRS.
It will just be smaller and far more select as to who it takes on as tenants.
This managing director however should read up this site.
She might learn about what is going on in a sector that she is supposed to be an 'alleged expert' in!!!!!!!!!
Surely society should promote home ownership first, and then property speculation, at the very bottom of the list.
Us baby boomers always went for home ownership, but then we were never workshy, we saved, we went without the flash new cars on the drip, the continental holidays in the sun, etc etc etc, Few snowflakes will ever own own property unless someone gives it to them, their problem, self inflicted fools, that keep us landlords wealthy
Mark
Not sure what you're putting in between? I think you believe speculation is a bad word? It's simply a synonym for "risk" and those of us who took the risk to provide homes for the feckless, reckless and hopeless now richly deserve the reward that justly follows well-researched risk!
I don't think speculation is a bad thing at all, it just isn't an activity that warrants government assistance. It is also not an activity that should not compete with home ownership. I must admit I find the word feckless totally derogatorily. Do you really mean it of the people you collect rent from. Definition: some lacking initiative or strength of character; irresponsible.
Feckless ? there good tenants, I currently have 15 out of 16 that I rate as good, and then there are bad, rouge, feckless tenants, call them what you like they are what they are and only have themselves to blame.
Who cares what they do with Stamp Duty sur-charge or not , we will not be buying anything, we are enough of you, sick of rogue regulators discriminating against us.
Mark what Planet are you on when did we ever have Government assistance, except never. Its good that you are so full of yourself so let someone else pay the tax for a change to keep the people you love milking the System. Its very bad advice to tell young people to buy their own over priced (50k to 100k) homes with stupid get into trouble schemes with only 5% Deposit, no SDLT & half the money interest free for 5 years as a carrot to rope them in to make max profit for big Developers but god help them for the rest of their lives when they have to start paying for what they though was a freebie. We have been hammered by rogue regulators loaded with huge costs licensing etc, unfairly. The Council are very good at wasting Tax payers the same ones that has taken millions of £'s in each Borough out of Private Sector Housing but I suppose Mark thinks this the Government helping us. A Council member in Brent is always shouting the odds knocking Private LL's has just spent £30m of tax payers money as I am sure its not her personal money buying up 114 flats to House who ? that will be the milkers in the main. 92 to be offered @ 80% of market Rent which is very good of her, but I think the Council don't pay tax, so I pay tax @ 40% & some @ 62% can I go tax free and I will Rent for 60% of market Rent.
Hello Sebastian my friend how right you are I am a slow learner. I didn't realize it takes so long to become a qualified stupid Landlord or in my case 42 years since 1978 that's 10 years before the 1988 Act. Where were all you guys when I was years campaigning for the 1988 Act. I believe only for Sir George Young (take my hat off to him) it wouldn't have happened or when we were campaigning for Section 21 but as usual you all come along and avail of what we achieve very handy for you. Where was high & mighty Shelter, Rentokil, ARLA, or Generation Rent but now they think we own them something .
Actually I am a Tea drinker.
Michael, till recently one of the main attractions of BTL was that the tax treatment was very favourable. The regime is now less so. Lobbying pressure from a generation who are unable to buy a home with the same ease as their parents means new lines have and will be drawn. From my position, I would much rather have it that when my kids want to buy a home they are not competing with BTL property speculators pushing up demand and prices. The Abolition of section 21 will in itself will bring some form of rent control so the easy money has already been made and you seem reluctant to wake up to the fact and smell the tea.
But we can increase the rent every 12 months by means of sec 13, so why does the abolition of sec 21 make for rent controls, the only effect the loss of sec 21 is going to have is that we are all going to be very careful who we rent to and in many cases are going to require a guarantor to sign up, the tax issue only really affects landlords with mortgages, many of us own our properties without borrowings.
Mark I don't agree your kids are not competing with BTL landlords it seems to me they are all on help to buy with no SDLT, this scheme is not available for buy to let LL's so how would they be in competition ?. Where did you get the idea it was easy for the Parents. I lived in rented accommodation for 9 Years in various Towns around the UK, when my take home pay was £25.00 per week and a reasonable house was £4.5k. I had some savings & applied for Mortgage but got turned down it was probably the biggest favor they could have done for me. I seen a plot in Brentford Gazette bought i,t got a Bank loan & Built my own House by my own hand with only hand tools no electric on site & cordless still to be invented incidentally which I still have so you think we had it soft. We didn't have Bank of Mam & Dad rearing us until we were 25, we were reared at 15, no iphones, credit cards, sky media or google, for me no family support possible & Dad RIP. The abolition of s21 will cause the biggest Recession ever known for sure without any Corona, why do you think that I have a duty to House your family go get their own. I thing your are a benefit LL that the Regulations don't apply to, just one fire door & yale lock on front door so it can open from inside. Regulations should apply to everyone or no one and same goes for SD. The Best way to stimulate the economy is to scrap all the Regulations made this last 10 years, imagine 4 pages Certificate for simple emergency light costing more than the unit (morans) and tell all those lame duck organisations to go & find a job even if they are capable ? and stop living off Private Landlords Backs.
Yes the affect of removing S. 21 will mean we will have to be very careful who we rent to and that means no one. It already takes 6 to 9 months to get someone out with S.21, without its a non starter. I know what it was like before S.21 so I don't to have to wait for it to taken away to know whats going to happen. The tax issues affects LL's in several ways Mortgage free or not, all those Licensing schemes are a huge tax, only applies to one half of the community, Taking away our wear & tear allowance is a tax, taking away my personal allowance is a tax, Capital gains is a tax, inheritance tax is a grave yard tax, (only 10 at Funeral). 40% income tax is a tax, so Mortgage free don't mean tax free does it.
Michael, I come from the same generation, but was lucky my take home pay as a HGV fitter was £30 per wk, my first house was a derelict small cottage in Norfolk which myself and girlfriend ( now wife) spent every wk end and every bank holiday renovating with our own hands, like to see the snowflakes of today doing that, but hey ho us baby boomers had it easy, or that's what people keep telling us
Mark, one of the main reasons why property got expensive apart from mad regulations is Government gave Bank of England power over interest rates to control inflation which was totally unnecessary & a stupid idea. Interest base rates used hardly ever be below 4% and more often stable at 5 to 6% not 0.1% so they abolished savers over night leaving them with their hard earned savings sitting in the Bank with no return & devaluing. They were all scratching around looking for something to do with their money needless to say they bought Property that they didn't necessarily need or want all bidding against each other driving priced through the roof like a ponzi scheme, so now you know why property prices are high its all of us. This was a massive mistake by BoE, we need savers and surely this is main reason why the young have no savings or Deposit for a property with no incentive to save, so wrong and can't be put right without crashing the economy and having millions of repossessions of the borrowers who bought their property based say, on a couple of percent Mortgage.
A section 13 rent increase is effected by agreement or Tribunal. With the abolition of section 21 Tribunals will have no way to deal with the thousands of claims, therefore a statutory formula will be the only solution. Now you may be thinking , no problem, RPI plus a % to something that will satisfy you. In my mind it doesn't take much to have a statutory rent review of plus RPI minus 1 or 2 percent. AKA rent control. Micheal you only need to look at the average age of first time buyer to now the world has changed . Back in the days there were no BTL landlords first off distorting the price of homes. Of course, and regardless the biggest cause of house inflation in recent years is the ultra low interest rates.
Right I think there was I remember Perec Rachman and the likes not nice LL's. I don't want to discuss Tribunals First -tier or upper or ever again go anywhere Alfred Place, from past experience when our case became a Land Mark case, imagine change the Law of the whole Country just to beat us costing huge amounts & a person to loose their life, can't discuss particular cases or I will probably be in more trouble. I often heard it said they can't boil an egg now they can't even make a cup of tea, we still need our sense of humor.
I don't know about section 13 but do know about Rule 13, you might go to tribunal thinking safe in the knowledge its a system to sort out your differences without too much cost schedule 12 as on application not more than £500.00, but be aware when fancy Lawyers get at it & convert it to rule 13 saying its an unreasonable claim & go for unlimited costs, who or earth would go there with the possibility of uncapped costs. It not how business is done keep well away from Courts and if Courts are the only remedy its not viable, don't be in business.
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