Landlords could receive tax breaks to sell up

The government is considering giving landlords a capital gains tax break to encourage them to sell second homes, according to reports.

It’s thought a number of ‘accidental landlords’ are being targeted to free up supply, meaning those who don’t see themselves as professional landlords.

An example of an accidental landlord is somebody with a property who inherits another one, which they choose to rent out opportunistically.

The Sun quotes a source close to the matter, saying: “The Prime Minister wants to shrink the buy to let market,” as it’s widely reported that Boris Johnson wants to make a radical move on housing before the next election.

Cutting or eliminating capital gains tax could have a big impact. As it stands basic rate taxpayers pay capital gains of 18%, while it rises to 28% for higher rate taxpayers.

The idea is at an early stage, as the government looks to encourage more renters to become homeowners, the latter of which are typically more likely to vote Conservatives.

Stamp duty cut for downsizers

In addition to accidental landlords, the government is weighing up whether to hand downsizers a stamp duty exemption in a bid to encourage housemoving.

It’s thought that a number of older people are reluctant to move because of the high stamp duty costs when they buy a smaller property. Therefore, if more moved it’s would free up more homes suitable for families to buy.

As it stands four in 10 properties are officially ‘under-occupied’, meaning they have additional bedrooms not being used.

And last November a minister said he wanted to encourage the elderly “rattling around” in large houses to downsize.

However Nick Sanderson, chief executive of Audley Group, isn’t convinced a stamp duty tax break is a good move.

He said: “The crux of the issue is simply that there aren’t enough housing options available for people looking to downsize. The Treasury can throw incentives at the market as much as it pleases, but many potential downsizers have nowhere they’d like to move and without changing that, how can the incentives work?

The retirement living market which provides specialist properties with health and wellbeing support as it is needed is chronically underserved and this is what needs addressing first. Reform planning rules to mandate age-specific housing, increase supply and only then bring in financial incentives to encourage downsizing. It’s this systematic approach that is needed if we are to provide solutions to the housing crisis.

Work has started with the government underlining its commitment to more specialist retirement housing and the formation of the Housing with Care taskforce. Now planning reform has be the very first point on the agenda.”

Comments 6

    1. Hi Ros,
      thanks so much for the link to your article. I had not seen this.
      in general of course you are completely right.
      Successive governments of all colours have consistently kicked the housing can down the road and only resurrect the issue when SOME public opinion becomes ‘louder” and in advance of “the next election”

      Another perspective if I may broaden the discussion a little please?

      I think there is also “another agenda” regarding the governments apparent hostile attitude to private landlords and would welcome your thoughts on this.

      The UK as I understand it is a signatory to the World Economic Forum. There is much derogatory comment about this all over You Tube and NOT from idiots.

      You may have seen the slogan


      The gist of this seems to be that our lords & Masters have discussed and agreed amongst themselves that private ownership of property (particularly 2nd homes or buy to let ) is not desirable long term and should be left to private institutions like pension funds (L&G are mentioned in particular) and our UK banks (LLOYDS are most mentioned) so they can build buy to rent blocks of faceless homes for people to rent for ever (yes-it does sound like what used to be known as council housing)

      to keep the masses quiet everyone should be offered a UBI (universal Basic Income) to placate those forced to rent forever. Link this to the widely published warnings from the likes of Elon Musk about the massive effects of soon to be coming AI (artificial intelligence) in the workplace it all makes more and more sense…

      People without jobs due to AI (Elon recently said that in his opinion AI will probably NOT effect engineering jobs but WILL effect almost ALL other jobs) will be unlikely to be able to afford to buy so state run “private wealthy companies-banks and insurers”-can make hay and money (and I cannot imagine those market sectors voting Labour) with a captive market and of course virtually limitless money.

      No doubt the government have not considered (or maybe don’t care) that these hugely wealthy organisations have become so by ruthlessly exploiting there customers. If thats not the case why are bank (and their offshoots credit cards) charging APR’s nudging 30% when base rate is !%. Once they have their captive renters they will squeeze rents beyond anything we have seen in the PRS thus far. And..they are far too big and powerful to be concerned about any “negative comments” re their behaviour from our by and large lack lustre MP’s or even Ministers. A senior member of a major UK bank told me recently that they think residential housing is the way they have to go but in his opinion less than 5% nett annual returns will not be tolerated. I think their are a lot of PR landlords who would love 5% nett.

      To sum up:
      sometimes I despair of our governance!

      I would really appreciate others views on this. I am so worried about what I perceive to be the western worlds (not just UK) direction of travel and in particular the effects on our children and grandchildren.

      Happy Days…

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