Landlords with more than 15 properties will be hit by the 3% stamp duty surcharge from April after all, the Chancellor has confirmed today.
Landlords with more than 15 properties will be hit by the 3% stamp duty surcharge from April after all, the Chancellor has confirmed today.
The 3% surcharge on buy-to-let property purchases was announced in the Autumn Statement last year and the government had initially suggested those with more than 15 property investments would be exempt.
But in today’s Budget George Osborne clarified: “I’ve listened to colleagues and the rates will apply to larger investors too.
“We are going use receipts to support community housing trusts, including £20m to help young families onto the housing ladder in the South West of England.”
Former RICS chairman and North London estate agent Jeremy Leaf reckoned the change will prevent investment in UK housing.
He said: “As it stood, the 3% stamp duty hike from April unfairly favoured larger investors at the expense of smaller landlords.
“In announcing that the new stamp duty rates on additional properties will apply to larger investors too, the Chancellor has balanced it so it is not helping either group, but in doing so he is compromising the chances of improving supply.
“Those larger investors such as pension funds and insurance companies which would have stepped into the gap created by a lack of smaller investors in the market may now be dissuaded from doing so.
“In dealing with one problem, he has created another. Anything that keeps the supply of rental property down and prevents investors from expanding their rental portfolios will result in less stock, higher rents and a perfect storm for both landlords and tenants.”
John Phillips, group operations director of Spicer Haart and Just Mortgages, said Osborne ignored the issue of housebuilding by instead tinkering with the stamp duty surcharge.
He said: “Osborne also restated the residential stamp duty reforms that will come into force next month and confirmed that large investors with more than 15 properties in their portfolios will be covered.
“However, until real measures are taken and building activity increases substantially, the long-term issue around demand for houses and the lack of housing supply means affordability will remain a significant challenge.
“It is therefore crucial that more work is done to get the homes built that the growing population desperately needs, and I’m surprised that his key priority wasn’t housing.”
