Will the new Chancellor undo Osborne’s BTL persecution?
Monday 25 July 2016
That’s the question on the lips of thousands of landlords across the country as Philip Hammond steps up to fill the vacancy left by the last Chancellor of the Exchequer.
George Osborne’s hostile campaign of persecution against the BTL industry featured a hike in the Stamp Duty surcharge and forthcoming cuts to the tax relief landlords can claim.
Philip Hammond has already indicated that he may use the Autumn Statement to ‘reset’ Britain’s economic policy.
As he embarked on a visit to China, Mr Hammond said he would review economic data over the coming months and added that the Treasury will act ‘if we deem it necessary to do so’.
Before assuming the top job of PM Theresa May told reporters the Government would no longer seek to reach a surplus by 2020.
Mr Hammond is himself a landlord who transferred his share of a £600,000 BTL property to his wife in 2014.
The transaction enabled him to stay out of the top tax rate, which hits anyone earning more than £150,000 a year.
Suspend Stamp Duty on homes under £500,000
Industry experts are calling for the new Chancellor to suspend Stamp Duty on homes under £500,000 in a bid to stimulate the market during post-Brexit uncertainty.
In 1991 Chancellor Norman Lamont suspended Stamp Duty for nine months on all properties worth less than £250,000 – a move which resulted in new mortgage approvals soaring from about 70,000 to 90,000.
Suspending Stamp Duty across the board – for second properties and BTLs as well as first time buyers – may cost the Treasury now – but the housing industry would benefit mightily in the future.
Landlords, who play a vital role in the supply of accommodation in an increasingly transient and fragmented employment market, would welcome a reversal of Mr Osborne’s changes.
The moves he introduced to the rental sector have been widely condemned as ‘anti-landlord’ and, so far, their stated aim of helping first-time buyers seems to have backfired.
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