Should landlords receive tax breaks..

Cornucopia

It's not about the cost of money. It's about the money.

ukcarper

Cornucopia wrote: »

It's not about the cost of money. It's about the money.

The money is going to the banks obviously the problem is that you would need to find both for the time it takes to build houses but in the long it would save millions and stimulate economy in short term but I'm well aware this is against the present governments policy and will not happen.

　

　

　

Cornucopia

When I borrow from the bank, that is called business.

When the Government borrows from the banks, it is public sector borrowing and adds to the deficit.

paul1964_2

Cornucopia wrote: »

The thing is this:-

Why would Government spend 100% of the cost of a house to rent it out to a HB claimant, when it can spend 0% (or close to)? Not only that, but the 100% would be capital spending - contributing to public sector debt.

See also: Why would the Government spend 100% of the cost of a hospital, when it can get the private sector to build & run it and lease it back?

Ah yes, good old PFI - get somebody else to pay up front, have a lease rather than a loan. Hey presto - no more debt.

What could possible go wrong.........

http://www.telegraph.co.uk/health/healthnews/8779598/Private-Finance-Initiative-where-did-all-go-wrong.html

ukcarper

Cornucopia wrote: »

When I borrow from the bank, that is called business.

When the Government borrows from the banks, it is public sector borrowing and adds to the deficit.

It would add to national debt but not necessarily the deficit

N1AK

Cornucopia wrote: »

The issue is that in many places, the market rents are too high for benefits claimants to be able to afford - that's why people are suggesting a subsidy of some kind.

If we wanted benefit claimants to be able to afford more expensive properties (properties in more expensive areas etc) than they currently can we could increase the benefits; bringing in a subsidy for landlords means more administration, complexity and cost and as far as I have heard provides nothing that simply changing benefits wouldn't resolve.

All that said, they shouldn't be doing either. One of the reasons why people don't want to lend to benefit claimants is that a small minority will devastate your property/not pay etc. If the government took steps to stop those problem tenants from ruining the rental market for other benefit claimants then people would be much more likely to rent to benefit claimants at a viable rate.

grizzly1911

Cornucopia wrote: »

The thing is this:-

Why would Government spend 100% of the cost of a house to rent it out to a HB claimant, when it can spend 0% (or close to)? Not only that, but the 100% would be capital spending - contributing to public sector debt.

See also: Why would the Government spend 100% of the cost of a hospital, when it can get the private sector to build & run it and lease it back?

To save having to pay out over the odds HB payments to private landlords. So many pundits on here tell us that buying is so much better than renting, but that is what the government is effectively doing to provide housing stock for those in need. Not only are we paying the cost plus profit we don't have any assets to show for it.

Government can borrow at lower rates than private landlords. It would contribute to public sector debt but so do many of the current strategies being implemented.

You do know how expensive PFI contracts are, regardless of who negotiates them.?

We take the capital cost but reduce the running cost. Volume house building can occur and pressure relieved on the current housing shortage. The private sector aren't in a position to meet the demand and haven't risen to the challenge since the 80s. Why should they do so now.

grizzly1911

Cornucopia wrote: »

When I borrow from the bank, that is called business.

When the Government borrows from the banks, it is public sector borrowing and adds to the deficit.

The interest would but so does the HB we are paying already.

grizzly1911

Cornucopia wrote: »

When I borrow from the bank, that is called business.

When the Government borrows from the banks, it is public sector borrowing and adds to the deficit.

The interest would but so does the HB we are paying already.

The increased debt would be balanced by an asset and capital reduction element could be factored into the "notional rent payment".

Not all those needing housing want to buy and many don't take full HB.

michaels

Graham_Devon wrote: »

...to let to people on housing benefits?

That's the question posed by the Guardian as a committe of london council leaders suggest proposing tax breaks to landlords if they take on those on housing benefits.

So....yes or no?

Does housing benefit itself go far enough? Or should we now pay the rent AND provide a tax break for the landlord receiving said rent money?

http://www.guardian.co.uk/housing-network/poll/2013/mar/13/landlords-tax-breaks-housing-benefit?commentpage=1

Going back to basics there are more households than houses.

Subsidising housing for one group of people surely just pushes the problem elsewhere?

In a normal market demand exceeding supply pushes up prices until demand is reduced and supply is inceased. Demand for housing is fairly price inelastic so why aren't rising prices resulting in more supply? Presumably the answer is a lack of capital because of the economy being overborrowed and in the throes of deleveraging.