New higher stamp duty for BTL/second homes

CLAPTON

leveller2911 wrote: »

I'm not sure what point your trying to make.

I don't have a problem with landlords if they maintain their properties and charge a fair rent but from my experience they dont.

I quote all the time for LL through letting agents and the LL very rarely have the work done and that why I now charge £75 per quote because they are wasting my time , the work doesn't get done by other companies so I'm not too expensive. If they have the work done the £75-00 is deducted from the invoice. I do however have a major problem with Housing benefit that LL receive . You say they pay lots of tax but they also rook the taxpayer with the high rents they charge for HB purposes. It was only when the Government limited the rent they would pay in each area for a 2,3,4 bedroom property, until then LL extracted the urine.

We all pay tax btw , I'm not sure a BTL who has a Ltd company pays anything like the tax that an everyday Joe would pay. There were far too many tax loopholes in the Buy to let market so lets not kid ourselves they are the ones who pay huge amounts of tax and the public should be greteful for the service they provide.They pay tax like other industries such as construction, retail etc so remind me again how much tax Amazon,Costa etc paid over the past decade.

If your providing a service (ie rental property) it should at the very least meet a minimum standard and many are not. If you purchased a TV from John Lewis and it was damaged you would want a replacement or your money back. I've lost count at the number of BTL properties I have been in that are just plain dangerous, the letting agents pass on the information but the work never gets carried out.

At the very least the BTL market need regulating properly and its clearly not.LL should stop looking at the BTL as a get rich quick scheme and realise they have obligations. Are you denying that in the past BTL have had an unfair advantage over FTB when buying property?. Huge Tax breaks etc?.

Like I said , there are plenty of other ways to make money........

there is a limit on the HB for the different types of property related to the local area (you can find them on the relevant website)

there are laws about housing standards and councils have the power to enforce them, but they don't do so

I don't know if LL pay the legal amount of tax but I'm impressed by your certainty that they don't : anyway the rules are changing in April and their tax bill will rise (no interest offsetting, no 10% wear and tear etc)

leveller2911

CLAPTON wrote: »

there is a limit on the HB for the different types of property related to the local area (you can find them on the relevant website)

There is now but there wasnt a cap a few years ago.........

there are laws about housing standards and councils have the power to enforce them, but they don't do so

The councils don't have the manpower to enforce the regulations since the cuts.

I don't know if LL pay the legal amount of tax but I'm impressed by your certainty that they don't : anyway the rules are changing in April and their tax bill will rise (no interest offsetting, no 10% wear and tear etc)

I never said they didn't pay tax, I said they used the Ltd company status to keep their tax liability to a minimum. Many small Ltd companies did pay next to no tax but could still claim "in work" benefits such as tax credits etc.

The rule changes can't come soon enough .........

CLAPTON

leveller2911 wrote: »

There is now but there wasnt a cap a few years ago.........



The councils don't have the manpower to enforce the regulations since the cuts.




I never said they didn't pay tax, I said they used the Ltd company status to keep their tax liability to a minimum. Many small Ltd companies did pay next to no tax but could still claim "in work" benefits such as tax credits etc.

The rule changes can't come soon enough .........

bizarre

your HB point was incorrect

your point about regulation was wrong

and I've no idea what you mean about small ltd companies claiming 'in work' benefits

Blacklight

House builders will work this into the price and then refund it in order for you to pay it. Adding it to the BTL mortgage and pushing up rents to recover it.

Higher stamp duty = higher house prices = higher rents.

They are all wealthier than anyone who thinks this will impact the BTL market because they are not stupid. You can see the 'Stamp Duty Paid!' adverts now.

Thrugelmir

the_flying_pig wrote: »

seems like quite a big deal to me? will definitely deter at least some casual BTL interest.

The assault will continue on property prices and ownership of. Voodoo George will push further needles into the house price doll. Until the desired outcome is achieved. BTL is only the public face of a much wider issue.

chewmylegoff

Conrad wrote: »

You 'all may recall me banging on about 2008 mortgage regulation tightening would lead to generation rent. Almost everyone thought this a non point.


My prediction this time is thus;


Mortgage regulation still means millions of people will not be able to buy, and now that B2L is becoming more difficult, a good many of those renters will have nowhere to rent either.


The argument prices will fall is nonsense, and even if they did, those frozen out of the mortgage market cannot buy anyway.
Furthermore tax increases mean rising rents.


Bring on the new generation that can neither buy nor rent.

So who is living in the house then?

padington

Thrugelmir wrote: »

The assault will continue on property prices and ownership of. Voodoo George will push further needles into the house price doll. Until the desired outcome is achieved. BTL is only the public face of a much wider issue.

This last policy announcement is going to increase prices, not decrease them. Anyone with a nice a buy to let or second home in a desirable area will be more likely to hold onto their properties now. Whilst the interest free loan for new builds is going to load a solid pipeline of demand into the bottom of the market.

George doesn't want to decrease his tax receipts or subsequent macro economic benefits of HPI by lowering house prices. He wants to play what he calls 'the game' of politics to win an election by increasing the house price franchise whilst stil ensuring his property driven boom is helping him pull white rabbits out of the hat like he did this week.

Now is a great time for an army of generation rent to pile into the property game, the consequences of that will be up, up, up for property prices and together with a bun fight to obtain your last ever stamp duty cheap second home, prices will most probably go up lots this year and then continue to rise steadily in subsequent years, not down.

As to building 400'000 plus properties any time soon, I'll believe it when I see it. However where building increases prices and not depresses them, watch the spades dig dig dig.

In my part of town, my place really started shooting up when the new builds round the corner started theatrically and loudly advertising sale prices for lots more than period properties like mine. Expect more of that to continue.

The bottom line is that 'generation build' can not be built in a deflationary market.

Thrugelmir

padington wrote: »

George doesn't want to decrease his tax receipts or subsequent macro economic benefits of HPI by lowering house prices.

More tax revenue would be generated if people did other things with their money. Paying interest on borrowed money to overseas investors does little to improve the UK macro economy.

padington

Thrugelmir wrote: »

More tax revenue would be generated if people did other things with their money. Paying interest on borrowed money to overseas investors does little to improve the UK macro economy.

I don't disagree. No doubt some BTL landlords that own horrible little squalid places they think no one wants to own and live in themselves, will loose faith before April and some of those will plough money into other businesses and help innovate new ideas.

Which is what UK Plc needs and the consenquence will be a richer country and well placed nice properties that owner occupiers want to buy will continue to do very well thank you very much.

leveller2911

CLAPTON wrote: »

leveller2911 wrote: »

your HB point was incorrect

In what way was I wrong?......... What was the HB cap in London pre 2010?.Can you provide a link where it shows there was a Housing Benefit cap in London Pre 2010?

your point about regulation was wrong

Please elaborate on this .......

and I've no idea what you mean about small ltd companies claiming 'in work' benefits

Its quite simple Clapton..........There were thousands of self employed sole traders who changed their businesses to Ltd status.

This allowed them to pay themselves a wage equel to the National Minimum wage, they could then claim "in work" benefits such as tax credits,HB,child tax credits etc. On top of that they could pay themselves tax free dividends at the end of the year. The divvies didn't go towards their income for benefit purposes and as such they could claim in work benefits. If they had stayed as sole traders their income would be too high to claim.

It was a well known loop hole but obviously unknown to people such as yourself who are not "street savvy". Over the years on MSE there has been dozens and dozens of threads about the subject on the benefits section and the discussion section of the site.