"MP hints at buy-to-let tax breaks"

IveSeenTheLight

Bootski wrote: »

Have you spent most your life misreading peoople?:rolleyes:

That why you verbally abuse them?:rolleyes:

Issit cause you haven'e seen the light?


I'VE SEEN THE LIGHT:cool:

LOL see below

Bootski wrote: »

Yeah but, apparantly, you're are:eek: selfish, paranoid cow

wolvoman

Sir_Humphrey wrote: »

If people bother to read the article, they would see Kennyboy66 is right on this one, and Hamish McTavish is too lazy to read.

It would be interesting to see what would happen if CGT were increased, since this has turned out to be a loophole rather than encouragement to entrepreneurs.

What you mean increased to 40%?

bbbbbbbbut weren't house prices still booming when they were at 40%? What makes you think that would make the tiniest difference now?

chucky

Sir_Humphrey wrote: »

If people bother to read the article, they would see Kennyboy66 is right on this one, and Hamish McTavish is too lazy to read.

but you didn't read the opening post - Kenny is 100% right but it's more about not investing in social housing and increasing the number of private landlords. if you want to increase private rentals you have to persuade people not to want to buy and rent instead. it's a political noise nothing else, it won;t happen.

chucky wrote: »

it doesn't look like the Government is looking at increasing social housing but more in the direction of encouraging private landlords...

Sir_Humphrey wrote: »

It would be interesting to see what would happen if CGT were increased, since this has turned out to be a loophole rather than encouragement to entrepreneurs.

nothing probably or very little effect - there too many options to avoid paying the CGT increase - transfer the property to Ltd Co and then sell it. CGT in a Ltd Co is much lower than personal CGT.

baby_boomer

Translation of the Minister's remarks

Damn. We've not built (m)any social houses in 13 years and now there's no money to build them with even though that's what a Labour Party is supposed to do. What a devastating failure to attend to our grass roots and be true to our ideals .

Never mind, if we encourage the private landlord, that will fit in with Gordon's recent dramatic change in election strategy to appeal to the "aspirational" middle class :rolleyes:

New Labour can always cut its coat according to the available cloth.

Thrugelmir

IveSeenTheLight wrote: »

Couple of points: -

1) Increasing the capital gains on property would possibly restrict new investors in the market but also make it less likely for current investors to cash in. If you want more property on the market to reduce the value and make more available for FTBers, a reduction on CGT may be better

2) Interest is already limited. It's limited to the valuation of the property at the time of purchasing. This means that the BTL owner cannot increase the loan above that to gain on taxes.

3) If there is less rental properties available, where will renters turn to. Not everyone can, wants or is able to buy. There are facts that show the amount of rental properties (social and private) are less than they were a decade or two ago.

As a BTL LL, I'd happily allow my tenants to sign up for longer rental periods. Realistically though, there are many tenants who equally do not want held to a long tenure

Your comments are made from a personal perspective, little of which would create new housing. Merely push up prices further, as investors with capital pocketed the gains.


Tax breaks if any. Might be aimed at larger organisations who would be building social housing for rental purposes. In exchange for lower corporation tax rates for example, they would agree to set rents at reasonable rates. On long term tenancies with say a built in increase upto RPI , capped at 2%. Thereby giving tenants long term security.

Thrugelmir

chucky wrote: »

nothing probably or very little effect - there too many options to avoid paying the CGT increase - transfer the property to Ltd Co and then sell it. CGT in a Ltd Co is much lower than personal CGT.

But then you pay tax to get the distribute the "cash" out of the company.

So not as straightforward as it appears.

blueboy43

chucky wrote: »

nothing probably or very little effect - there too many options to avoid paying the CGT increase - transfer the property to Ltd Co and then sell it. CGT in a Ltd Co is much lower than personal CGT.

not sure if thats the case after the new rules from April 08 - Ltd companies are not classed as a trade if its property investment so miss out on things like entrepreneur relief.

I have seen it suggested that limited liability partnerships is the most favourable environment but perhaps that will be the next loophole to be filled.

You are right that there are always ways to minimise the tax, particularly if you have only 1 other property and utilise main home relief somehow.

Either way, I suspect that the sands are shifting a little and plenty of politicians see that discouraging people from keeping all their wealth in 'unproductive' investments such as housing is probably a good idea.

One Labour budget and one 'emergency' Tory budget expected over the next 6 months - either one could make tax worse for BTL'ers - they can look to Ireland as they have already done it, and to be honest, who is going to be up in arms about landlords paying a bit more tax to fill the black hole.

IveSeenTheLight

Thrugelmir wrote: »

Your comments are made from a personal perspective, little of which would create new housing. Merely push up prices further, as investors with capital pocketed the gains.


Tax breaks if any. Might be aimed at larger organisations who would be building social housing for rental purposes. In exchange for lower corporation tax rates for example, they would agree to set rents at reasonable rates. On long term tenancies with say a built in increase upto RPI , capped at 2%. Thereby giving tenants long term security.

Your right, my comments are from a personal perspective, as I would think most comments on this foum are.

As a property investor, my point was that increasing CGT would reduce the likelyhood of me releasing properties, while a reduction may make it more tempting.

Your interpretation of what the tax breaks might be may be a little optimistic. The government is already reliant upon private rentals and has been giving up any control they might previously have had by paying any rent benefits direct to the person in order for them to have a personal choice of where to live.

Spartacus_Mills

chucky wrote: »

http://www.yourmortgage.co.uk/news/3626452

it doesn't look like the Government is looking at increasing social housing but more in the direction of encouraging private landlords...

Interesting article. For me the problem with renting, as seen in the BTL boom, is not so much the availability of rental properties but the type and the quality of them. Government regulation going back to Prescotts day forced more brownfield developments (no bad thing) but also higher density of homes for the land available. Hence the increase in flats in city centres with minimal demand for them. Manchester is like a ghost town in parts. But the build standard of these properties has been poor. For instance Cllr John Lines who chairs housing on Birmingham City Council looked to buy some flats in a private development in the Jewellry Quarter in Birmingham to use for social housing and the standard was so poor they failed to meet the councils criteria. Protecting tenants is one thing but the quality of the homes and diversity of property types available is also important. There are regulations in place but they would need to be reviewed and the issue of dealing with problem tenants also needs to be tackled. It always strikes me as hugely unfair the hoops a landlord has to jump through to evict a troublesome tenant.

IveSeenTheLight

Spartacus_Mills wrote: »

Interesting article. For me the problem with renting, as seen in the BTL boom, is not so much the availability of rental properties but the type and the quality of them. Government regulation going back to Prescotts day forced more brownfield developments (no bad thing) but also higher density of homes for the land available. Hence the increase in flats in city centres with minimal demand for them. Manchester is like a ghost town in parts. But the build standard of these properties has been poor. For instance Cllr John Lines who chairs housing on Birmingham City Council looked to buy some flats in a private development in the Jewellry Quarter in Birmingham to use for social housing and the standard was so poor they failed to meet the councils criteria. Protecting tenants is one thing but the quality of the homes and diversity of property types available is also important. There are regulations in place but they would need to be reviewed and the issue of dealing with problem tenants also needs to be tackled. It always strikes me as hugely unfair the hoops a landlord has to jump through to evict a troublesome tenant.

The transfer to private rental has seen an increase in the quality of rented properties.
Sure there are always extremes.

I recall an interview on TV where a polition was grilled over their failure to meet their own targets regarding improvement of social housing.

Certainly in private rental the tenant can easily move to an alternative property therefore inherantly forcing LL's to make their properties to a higher standard.
This certainly was not the case in social housing.