Prime Minister David Cameron has dismissed out of hand appeals and comments from Letting Agent Today readers to reconsider the recent measures aimed at making buy to let investment less attractive.
Earlier this month LAT readers had the rare opportunity to have their concerns put to the premier by Andrew Goldthorpe - chief executive of PropertyMutual.co.uk and owner and managing director of PropertyPortal.com - who lives in Witney, where David Cameron is the local MP and holds weekly surgeries for constituents.
After a substantial number of comments were contributed by readers, (here), they were put to the Prime Minister’s office by Goldthorpe; the hope was that they may be the focus of a meeting so the issue could be discussed, even briefly, on an MP-and-constituent basis.
However, this has not happened and instead Goldthorpe received this ‘stock’ response from the Prime Minister through his constituency office staff:
“David has read your email and I spoke to him today.
He says “There is a problem that in many places families who can’t afford a home to buy are being squeezed out by people buying a home to let, or as a second property to stand empty for most of the year.
“That is why we have introduced a new rates of Stamp Duty that will be 3 per cent higher on the purchase of additional properties like buy-to-lets and second homes.
“This extra stamp duty raises almost a billion pounds by 2021 – and we’ll reinvest some of that money in local communities that are being priced out of home ownership.”
“He has also sent your email to the Financial Secretary of The Treasury for his comments on the highlighted part of your email [referring to the official consultation about the proposed stamp duty change] and thank you again for writing.”
Goldthorpe says he made it clear to the Prime Minister’s constituency office “in no uncertain terms” how disappointed he was that this attempt to put the industry’s views was dismissed out of hand.
For any reader not aware of the huge debate within the industry in recent months, the three most controversial measures proposed by the government are:
- an additional stamp duty surcharge of three per cent on all ‘additional properties’ (so chiefly buy to let properties and second homes) priced above £40,000;
- the restriction of mortgage relief for buy to let investors to only the basic rate of income tax, even for investors paying higher rates;
- a change in the Wear and Tear Allowance, permitting landlords to claim only for repairs involving receipts.
To add insult to injury, as many in the industry see it, the official consultation over the proposed stamp duty surcharge was launched on a Bank Holiday in the middle of the Christmas and New Year break, when publicity and industry attention was at its lowest.
However, readers still have until February 1 to respond to the consultation.
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I for one was considering adding another BTL to my portfolio but have now abandoned the idea as a direct result of Government policy. Multiply this several times with serious portfolio investors who might now sell some of their properties, and it begins to look like Messrs. Cameron & Osborn have made a really bad decision. Back of a fag packet policies are just not thought through enough. As for the PM not wanting to listen to reason does not surprise me at all. This is definitely one out of the Labour Manifesto book; they haven't said a word!
I hate to agree with anything printed in the daily mail but their take on this issue is pretty spot on. George is the most Socialist Chancellor we have had for generations, ironic really. Then again, history repeats itself, the Spanish constitution was the most liberal the world had ever seen and yet it gave rise to the inquisition! When Corbyn becomes PM maybe he will abolish the NHS and bring back the poor house- there's none stranger than folk
It's bizarre.... now we have a Tory majority it turns out we really have a Liberal not Conservative government! It seems dishonest-Dave was a crypto- liberal all along and is now using Tory votes to force through socialist legislation and changes. He and his cronies are essentially dictators with no regard or respect for the people who were duped into electing them, and so it's not surprising that don't give a damn about Andrew Goldthorpe's concerns and feel at liberty (being liberals) to casually dismiss him and insult his (and our) intelligence with their double-speak lying response.
Slapping a 3% SDLT surcharge on to BTL purchases wasn't designed to create buying opportunities for "families who can’t afford a home" (in general it will make next to no difference to them if they already can't afford to "buy a home"). It was designed to fleece the sitting duck (a mixed metaphor for which I apologise!) of private rental sector landlords.
And note their devious double-speak claim that they "...we’ll reinvest SOME of that money in local communities..." which is coded language to explain that they need this money for other things and will not spend any of it (apart from perhaps some token amount if vote catching or news worthy) on doing anything to help so-called "families who can't afford to buy a home".
But there's more.....
We've been hit by several other huge anti-BTL, anti-private rental sector stealth-tax hikes too.... some that seem to have slipped passed most people unnoticed, e.g. the disgraceful phasing out of the fair and necessary exemption from COUNCIL TAX for EMPTY UNFURNISHED AND UNOCCUPIED PROPERTIES.
We are now being forced to pay literally thousands of pounds a year in c/tax for properties between tenancies. It is despicable and utterly unfair!
There used to be, quite rightly, a complete exemption - as c/tax (that replaced rates and, temporarily, the unpopular "poll tax") was designed to collect money to pay for local services the people living there were using or could use. Empty flats and houses don't these services so why should they now be paying for them. Illogically the 1 year exemption that was reduced to a 6 month exemption and then - pathetically - a 2 week exemption was abolished altogether on the grounds that this way "Landlords can now support some of the most vulnerable people in the community" (that was what our local council claimed in their covering letter when writing to us to explain away this latest stealth-tax hike).
And there's more to come..... the next step will of course be to hit us all with a SURCHARGE COUNCIL TAX RATE (perhaps double or even triple) to "encourage" us to "bring empty properties back into use". Another blatant lie, of course, since who wants to have an empty rental property... the council probably does because they are now taxing us for it without having to provide any service for that money!
(Imagine the outrage if commuters who took the day off work because they were unwell were forced to pay train fares for journeys they didn't take, perhaps having to pay a surcharge of more than the normal cost, and the greedy cash-strapped council claimed it was doing this to encourage them back to work or something!)
PS. I know councils don't run trains... it was just a silly analogy to make the point :-)
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