The housing market is broken – but today’s Budget was completely devoid of any policies to help homebuyers
Steve Bolton, founder of Platinum Property Partners, says yesterday’s Budget was completely devoid of any policies to help homebuyers.
He said: "It’s particularly disappointing that the government failed to comment on or reform the upcoming reduction in mortgage tax relief for landlords that threatens to derail the buy-to-let sector.
"The route to homeownership for first-time buyers must be made easier. Proposed measures to help young people acquire more skills, and therefore potentially achieve a higher income in the long-term, are positive but won’t make a difference in the short-term. Attacking landlords and putting pressure on the private rental sector will only hinder tenants’ aspirations to get onto the property ladder. After the Tenant Tax is implemented next month, many landlords will find their tax bill outweighs their profits, forcing them to either leave the market or put up rents. Both will ultimately result in higher costs for tenants, who will then struggle even more to save for a deposit.
"The government has positioned this tax change as levelling the playing field for first-time buyers and investors, but the fact is they generally do not buy the same types of properties. Preventing landlords from buying homes will not result in a wealth of properties becoming available for first-time buyers or mean that tenants suddenly have the required deposit to buy. Renting is also the desired option for many at certain times of their life before they decide where and whom with to settle down.
"There is a fundamental misunderstanding of how the BTL sector operates at the heart of this policy and it also completely contradicts the importance placed on the rental sector in the government’s recent housing white paper. When this tax was introduced in Ireland, rents soared until the government was forced to repeal its policy. The same will undoubtedly happen in the UK. But while we wait for government to realise its mistake, thousands of hardworking tenants and landlords will suffer. The Tenant Tax must be abolished before real damage is done to rental sector."
