Government holds firm over buy-to-let taxes
The government is showing no sign of reversing its policies of imposing extra taxes on landlords to curb buy-to-let investment, despite thousands of people demanding a rethink.
An e-petition, calling for the government to bring back full mortgage interest relief for buy-to-let investors and scrap the three per cent second home stamp duty surcharge introduced in 2016 has now gathered over 14,000 signatures.
The petition emerged amid growing evidence that the new tax measures are hitting landlords hard and deterring them from making new investments.
According to research by the Residential Landlords' Association (RLA), 69 per cent of landlords have been put off buying more property by the changes.
Backed by the RLA, the e-petition is available to sign until November. Under the rules governing these, the government has to respond when a petition tops 10,000 signatures and the issue must be considered for debate in parliament once it reaches the 100,000 mark.
However, the government has produced a lengthy statement reiterating why it believes the legislation was correct.
The statement said it wanted to "reduce the advantage landlords may have over homeowners in the property market" through the changes, which would therefore support first-time buyers.
It acknowledged that the measures will affect the buy-to-let sector and "some of these landlords may face difficult decisions". It said that this was the reason for the mortgage interest relief measures being introduced in a "proportionate and gradual" way, which "gives landlords time to adjust to the changes".
Landlords and agents may therefore have to do more to persuade ministers that large-scale divestment will bring some unforeseen problems.
The National Landlords' Association (NLA) has warned that difficulties could be on the horizon after a recent survey of its members found 380,000 are considering selling at least one property in the next 12 months, with only seven per cent planning to sell to other landlords.
NLA chief executive Richard Lambert warned that, while this may help many first-time buyers, it could lead to a "significant fall" in availability for those who are not currently in a position to buy, or do not wish to.