The Chancellor has rendered hundreds of lettings businesses unviable overnight as a result of his Budget tax clampdown.
That’s the view of the Short Term Accommodation Association, a fledgling trade body for the short lets sector.
It warns that the changes to the tax treatment for furnished holiday lets announced by Hunt earlier this month will force the closure of hundreds of businesses around the UK.
Chief executive Andy Fenner says: “Plans to change the tax treatment for furnished holiday lets have sent shockwaves through the industry and are likely to force the closure of hundreds of small businesses.
“Now the dust has settled on the announcement, it’s no exaggeration to say that there is real fear out there.
“We urge the Government to reconsider before irreversible changes are inflicted on a sector that has been hit by so much already. From planning reform, to licensing and registration schemes, the disruption and extra cost pressure the industry has already been asked to endure has felt endless.
“Against this backdrop of near-constant uncertainty, the latest proposals are a step too far.
“Some of these businesses will be single properties, others portfolios that support dozens of jobs. Many of them will be small businesses that have been built up over decades, sometimes involving multiple generations of family owners.
“What has been proposed will tear up a playing field that has been largely responsible for turning the holiday let industry into one of UK tourism’s crown jewels. If we move the goalposts, many of these businesses could be rendered unviable overnight.”
In a separate development a survey of 833 UK property professionals, commissioned by GetAgent, found that the vast majority were disappointed in the Budget, with 27% describing it as inadequate and a further 54% stating it was underwhelming.
The industry had been expecting a significant announcement on 99% mortgages: however, this was scrapped just days before, a decision that 56% of those surveyed agreed with.
In its place, there had been hopes of another stamp duty reduction based initiative and 71% of those surveyed believe this should have been included.
Some 67% also stated they would have liked to see some other form of buyer incentive introduced to help kick start the market, with 64% stating they would have liked to have seen more focus on housing supply.
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Before retirement I owned a holiday park with bungalows which could only be used for holiday purposes, not residential. Seems a tad unfair if they are treated the same as the properties cannot return to the long term rental sector
I don't think they are affected by the budget, especially if owned through a limited company.
Properties owned through private limited companies will be the next target but large property PLC 's will no doubt not be affected as they'll be where former ministers get directorships.
Richard, are you the person that has been mentioned in several news articles recently?
Makes me wonder what the government and council are smoking these days.
The Government want rid of Air BnB and the PRS, local councils are screaming out for places to house people and to get rid of Air BNB houses??
I guess it's reasons beyond my comprehension, so I guess the government and council will just take over more B&B's?
Which are in holiday destinations will just mean that they pay more for the same amount of people housed, but not giving money to people that are trying to make a living.
I guess this sector is joining the PRS party 🎉 😱😱🆘🆘
Yet again our government fails to consider the Unintended consequences of their actions.
A lot of short term rental properties, will not be able to move to the PRS as they are in the wrong location or the owners will simply not want to take the risk involved with PRS letting and the danger of sitting non paying tenants.
Technically they are un-viable from next April. I guess its 12 months to sell up or do something different. Welcome/welcome back to the tedious world of being a landlord offering long term lets and getting screwed left right and centre.
This is what happens when you have amateurs in Government. Mrs T at least came from a business background and had a Chemistry degree. Most of the fools in Westminster studied Politics and little else.
Big Gov now tramping over the Holiday Let’s sector in the same way it has decimated the the resi sector.
Either these Gov clowns are totally inept or there’s some wider plan at play. If the latter what are they up to?
There is a wider plan. Let big business take over!!
heard this was happening and got domestic rate council tax bills on my 5 self catering flats, i am now fighting the VOA to change back to business rates which are rated zero.Barely broke even last year due to 2 years of covid and high interest rates. Great time for us to have to prove our trading income and setting limits on nightly lettings. The flats are not to building regs for the PRS so what are we supposed to do ,nobody buying and nobody coming on holidays.? It will also effect all the local small businessess as no foot fall on the streets, or people just staying overnight.Be glad when this government is gone but also dread who might ensue
Good luck re, VOA. I hope your phone bills don’t go manic!
A JR. We don’t need to be Colombo to know what they are up to but they are too sneaky to come straight out and say it. Just make Rules, Requirements & Regulations + loads of added costs to make what they want happen, us out for their friends to move in and take over simple, hang on a minute must check my IQ.
This sounds like a government led by Jeremy Corburn. Destroying good businesses and lives of hard working people. The only way you can make money is by being on the dole!!
The politics of envy and socialism coming from a supposedly Con- Servative Anti- Landlord government.
They are like lemmimgs queuing to jump over the political cliff into obscurity. To be replaced by Sneer Charmer and his bunch of lefty pals including Angela "Two Homes" Raygun and her vitriolic anti- landlord sentiment. The PRS is doomed....
This has to be a sinister scheme by the govt. There are lots of tradespeople in areas with FHL who say that they would have no work if FHL was killed off in those places. But they don’t care: they simply want to increase the PRS after having made PRS less appealing. It is the govt that caused the rise in FHL!
Hi Tony ,
Not sure if they want to increase The Private Rental Sector. `The Government want to increase cost and legislation and Regulations for small private Landlords. So they sell up and make Tens of Thousands of Families , and other Renters Homeless` .
If you think this is bad just wait and see if what happens if enough fools vote for Labour. Personally, I don't think there is much difference between the Tories and Labour and I don't trust either. I'll be voting REFORM
I've lived outside of the UK for so long, I'm not entitled to vote. That said, looking at how the Conservatives have treated us over the last few years and knowing what is coming when Labor get into power... I would't want to vote for either.
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