There were a fair few bombshells for those in buy-to-let…
Lots of landlords have felt the rough end of government policy recently, some 35,000 going so far as to sign a petition against the Chancellor. Much of the ire stemmed from a controversial Summer Budget, so what did the Autumn Statement bring? Read on a brief round-up…
A stamp duty catastrophe?
Without doubt the biggest news in buy-to-let was Osborne’s pledge to increase stamp duty. A new 3% surcharge is due to be enforced from April 2016, but it’ll only impact on those buying second properties.
The likelihood then is that landlords will lose out to first-time buyers, which appears to be Osborne’s political intention. Some property experts have even gone so far as to label it ‘the death knell for buy-to-let investors’.
In response, it’s likely many will raise their rents - in a bid to protect their dwindling margins - whilst there’s also the chance that property being sold between investors may decrease in price. Others think we could see a ‘temporary market surge’ as landlords embark on a buying spree.
Yet another controversial move from the Treasury, the impact could be tumultuous…
Plus billions spent on helping first-time buyers
On top of the changes to stamp duty, Osborne pledged to put billions into new properties. Notably, the emphasis was on helping Britain’s first-time buyers, thus taking them out of rental and into their own properties.
Amongst his promises were to…
- Pay £2.3 billion directly to developers to build starter homes for sale to first-time buyers
- Put another £4 billion into building 135,000 ‘Help to Buy: Shared Ownership’ homes
- Spend some £200 million to help create 10,000 new sub-market rent homes, that tenants can live in for five years whilst they save for a deposit
- Remove restrictions on shared ownership and reform the planning system, in order to deliver more homes
Big commitments, it’s worth keeping an eye on Osborne’s progress here, as the rental market may feel ripples.
Capital Gains Tax tinkering
Also announced was a change to the way landlords will need to pay Capital Gains Tax, a tinker to tax law meaning that this will soon be repayable within 30 days of a sale.
Set to be enforced from April 2019, it’s another sizeable shift. Whilst it’s still a few years away, keep this mind, as missed payments could bring penalties.
We’d love to know your thoughts on all of this, especially the stamp duty changes. What could they spell for you and your rental property? Let us know in the comments below.