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Tax Take: Petition for Sunak to close holiday lets tax loophole

A tenant who says his former rental property has been turned into an Airbnb has set up a petition demanding Chancellor Rishi Sunak make reforms to property taxes. 

Alex McIntyre has posted his petition on the 38 Degrees petition website; the petition is flagged with the logo of the Generation Rent campaign group.

McIntyre, from Plymouth in Devon, says his city has turned into “a city of holiday lets” and he quotes the Cornwall Council figure that Rightmove recently posted only 62 available homes to let in that county, while Airbnb advertised 10,290 Cornish properties available to tourists.

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“By removing mortgage interest relief from holiday lets, more property owners will make their homes available to people who need somewhere to live. This will reduce rents, stop people being priced out, and make sure communities in tourist hotspots benefit” he writes.

On social media McIntyre’s petition has been backed by a London Labour councillor - Eve McQuillan, the member of Tower Hamlets council responsible for planning.

Referring to the eviction of long term tenants to make room for Airbnb and other short let renters, she writes: “This is a huge problem in Tower Hamlets. Landlords are able to rent out a flat as a holiday let for three months of the year without any extra permission. It means too many evict tenants after nine months and making housing even more costly and unstable - these lets could be a home!”

You can see the 38 Degrees petition here - its wording is reproduced below. 

 

I feel privileged to live in Plymouth. It's by the sea, has amazing beauty spots, Dartmoor is close by and the nightlife, pre-covid, was phenomenal. It is one of the UK's top tourist destinations. Unfortunately Plymouth's advantages can also be a disadvantage for its residents.

I lived in my last flat for 5 years. The rent was affordable and it was close to the city centre – but was not in a great state of repair. When I complained to my landlord about the broken boiler and asked him to make repairs to his property, he threatened to evict me.

One day a Section 21 notice arrived for me and the other tenants in the building, meaning we had to move out. The landlord said he was selling up because he did not want to be a landlord anymore.

But a few months later, I discovered he had turned the building into an AirBnB. I found pictures online of my old flat which he had renovated and done up to perfection.

My neighbours and I are not the only ones this has happened to. Plymouth has become a city of holiday lets. Cornwall has 62 homes to rent on Rightmove but 10,290 AirBnB listings. In one village in Wales, three quarters of the houses are holiday homes.

Fewer homes available for residents mean higher rents, and people being priced out of their local areas in search of a home. That erodes local communities and starves local businesses of workers. The only people who benefit are the landlords.

One cause of this is mortgage tax relief, which holiday-let landlords are entitled to but private rental landlords are not. It is saving holiday-let landlords potentially thousands of pounds every year, and actively dissuading them from renting their houses out to locals. After all, why rent to actual residents when the government has made it cheaper to let out holiday accommodation?

We need a level playing field so that the local areas enjoy the right balance between holiday lets and homes people want to live in. By removing mortgage interest relief from holiday lets, more property owners will make their homes available to people who need somewhere to live. This will reduce rents, stop people being priced out, and make sure communities in tourist hotspots benefit.

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    How about you reinstate the mortgage tax relief for the business of property letting? This will reduce the rents and encourage some to not switch to holiday letting.

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    The parasites are feeling entitled again. They should move to a communist country.

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    Don’t blame the landlords for the lack of housing! Shout loud and blame governments and housing associations that have let you down badly..
    Landlords, work hard, save hard and risk their own cash to invest in property. Try it folks… it’s hard work, really hard work with sacrifices, which deserve rewards.
    I’m sorry but the landlords are an easy target for people and organisations that have taken their eye off the ball, not invested heavily in housing and are now looking for the easy way out and someone else to blame.

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    Well said. Property owners who are landlords have obtained the property by inheritance or by spending their own money on a Buy2Let. In my case both until recently. The legal obligatons are theirs. as are any finiancial rewards.

    Gordon Brown stole our pensions and providing for my (long overdue) retirement influence my becoming a landlord with some friends. The properties are well-maintained, redecorated frequently and ugraded where possible. I am not a landlord for fun. It is a Business and it is not for Alex McIntyre to tell me how to maximise profits.

    As it happens I prefer to let to responsible, professional, hard-working tenants rather than risk AirNB. That is MY choce to make, not his. I would have more sympathy for his position if he was campaigning to reintroduce mortgage tax relief for residential landlords.

     
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    Its an interesting view from a tenant. However firstly the property owner explained that they no longer wanted to be a landlord which is entirely truthful, they wanted to be part of the short term letting business. Why not its their business and if they want to partake in a more active investment strategy then that's their choice. Having owned a hotel personally I would not want to be part of that business.
    Secondly why does this former tenant describe it as their old flat, it was never their flat or their property they were paying a market rent for it, ownership was not part of the deal.
    Whilst tax changes have made the changeover to short term lets faster I believe it would have happened anyway as it is a new and growing market, the tax changes speeded all of this up.
    I notice all the usual suspects are now keen to gang on short term let investors now, its just jealousy

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    Micheal, its not jealousy, it is basically a shakedwon of the PRS sector by big American Banks and will lead to a another sub prime banking crisis. The big players will have sold their portfolios on then shorted the purchasers like they did with the sub prime, making a double killing.
    This man in Plymouth hasnt said anything about paying the rent either by hiself or his fellow occupiers. I dont see a landlord giving up on a decent all year round income stream for a few weeks of short term lets. The south west has always had lots of BnB in it. It was Thatcher who sold off council housing very cheaply, to appease the working class whilst she looted the stae owned inndustrfies.

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    Typo- Industries !

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