New, extra 3% Stamp Duty on BTL?
Discussion
528Sport said:
Agree with most of your views. But a 3% increase will simply push rents up.
"but I fully welcome any & every change that makes property as an 'investment' less attractive."
Then why not make it less attractive to EVERYONE not just those with less that 15 properties?
Make mortgages easier to get for home ownership then.
As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
I agree that measures should be taken across the board to help first time buyers, not just target specific groups- however something being done is better than nothing, hopefully it is just the start."but I fully welcome any & every change that makes property as an 'investment' less attractive."
Then why not make it less attractive to EVERYONE not just those with less that 15 properties?
Make mortgages easier to get for home ownership then.
As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
528Sport said:
Until this happens we will need MORE landlords.
I'm not going to complain too much for people making the most of the situation that is presented to them- it's certainly made a lot of financial sense to those people for the last while. However I personally don't think encouraging making the problem worse before we try and solve it is the right way to go about it- in my opinion. 
Squirrelofwoe said:
528Sport said:
Agree with most of your views. But a 3% increase will simply push rents up.
"but I fully welcome any & every change that makes property as an 'investment' less attractive."
Then why not make it less attractive to EVERYONE not just those with less that 15 properties?
Make mortgages easier to get for home ownership then.
As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
I agree that measures should be taken across the board to help first time buyers, not just target specific groups- however something being done is better than nothing, hopefully it is just the start."but I fully welcome any & every change that makes property as an 'investment' less attractive."
Then why not make it less attractive to EVERYONE not just those with less that 15 properties?
Make mortgages easier to get for home ownership then.
As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
528Sport said:
Until this happens we will need MORE landlords.
I'm not going to complain too much for people making the most of the situation that is presented to them- it's certainly made a lot of financial sense to those people for the last while. However I personally don't think encouraging making the problem worse before we try and solve it is the right way to go about it- in my opinion. Dave
Some Gump said:
onedsla said:
Coupled with the April changes, this sounds like a good way to push up rent, making it even harder for first time buyers to build deposits.
Rents are a function of demand / supply, not a function of cost to purchase. In fact, the cost part is driven by the rents - not the other way round. Putting 3% more SD on the BTL sector will marginally ease the competition between FTB's and wannabe landlords, potentially reducing the market price of a house slightly, but I can't see any way mechanism where SD will impact market rate for rentals.Investors and second property owners may substitute their investments to another market ie they might buy property in Spain, France etc etc.
"Rents are a function of demand / supply, not a function of cost to purchase".
Maybe if we were in a perfect market but the UK housing market is clearly imperfect. Rents are created by regional variation and are driven mostly by regional property values and to a lesser extent by regional demand from tenants and this would be reflected in their curves.
As a buy to let investor, none of this would bother me, the increase in tax will be absorbed into the market price of the property as it will affect all parties so it will reduce the value of properties. As even if the property is bought by someone who is not going to rent out it will be resold in the future and the increase in tax will limit investors from buying so reducing the market price.
528Sport said:
Make mortgages easier to get for home ownership then.
As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
Instead of bashing landlords help people buy a home. Until this happens we will need MORE landlords.
Could the refugees coming to this country get a mortgage instantly? No so you need a BLT property for them.
Like I said earlier there is a demand for the service
Indeed. The news rules to protect people from themselves are bonkers. My tennants pay me every month without fail a sum of money that with a 10% deposit they could easily pay back a mortgage on the same property. But they cant get one. Primarily because one is self employed. And i know how that works out with banks. Until this gets solved, first time buyers are not going to find it easier.As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
Instead of bashing landlords help people buy a home. Until this happens we will need MORE landlords.
Could the refugees coming to this country get a mortgage instantly? No so you need a BLT property for them.
Like I said earlier there is a demand for the service
Eric Mc said:
Welshbeef said:
Hi Eric so if you simply move house but have more than 1 property in the UK do you then get stung by 3%
Let's say you have £3m house and move to a £3.5m house and a couple of £250k houses would they have to pay 3% on the £3.5miillion?
You can dream up all sorts of permutations if you want. Lots of people are doing just that. Like in Capital Gains Tax, the key is establishing what is your main residence. Selling a main residence and acquiring a new main residence to replace it should not incur the 3% surcharge.Let's say you have £3m house and move to a £3.5m house and a couple of £250k houses would they have to pay 3% on the £3.5miillion?
Having a main residence and acquiring an additional property that is not your main residence (or two or three or more) WILL incur the 3% surcharge each time you buy an additional property.
Just to be clear though, the Treasury has not said that they will use The PPR concept have they? They've only talked about a second property, we will need to wait and see the consultation before getting any idea of how it will work.
monkfish1 said:
528Sport said:
Make mortgages easier to get for home ownership then.
As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
Instead of bashing landlords help people buy a home. Until this happens we will need MORE landlords.
Could the refugees coming to this country get a mortgage instantly? No so you need a BLT property for them.
Like I said earlier there is a demand for the service
Indeed. The news rules to protect people from themselves are bonkers. My tennants pay me every month without fail a sum of money that with a 10% deposit they could easily pay back a mortgage on the same property. But they cant get one. Primarily because one is self employed. And i know how that works out with banks. Until this gets solved, first time buyers are not going to find it easier.As I said earlier the rules for BTL mortgages are so simple. No affordability checks in most cases...
Instead of bashing landlords help people buy a home. Until this happens we will need MORE landlords.
Could the refugees coming to this country get a mortgage instantly? No so you need a BLT property for them.
Like I said earlier there is a demand for the service
nct001 said:
The increase in costs of entry to BTL ie from an increase in direct taxation of 3 per cent - could decrease demand for btl from landlords (diminishing marginal utility), so in the medium to long term reducing the supply of landlord btl properties so reducing the supply of btl properties, so increasing rental values. All things being equal.
The total housing stock is near to fixed though - supply of the commodity is extremely inelastic. If BTL'ers leave the market, they'll be replaced by owners - houses don't up and vanish. This may of course reduce rental supply, but only by the equal amount it's reduced rental demand (because they've bought a house). I can't think that anyone can properly argue that increasing stamp directly increases rent prices. As you reference above - if you follow utility theory, then the value of rents is goverened by the supply of the lowest cost equivalent / close alternative, nothing more.
The Private Rented Sector is vital to councils who can't cope with need/demand.
Round here there are adverts on the back of buses to get landlords to make their properties available to the council.
I bet the leader of the council is loving this SDLT increase/potential choke off of BLT (not).
Round here there are adverts on the back of buses to get landlords to make their properties available to the council.
I bet the leader of the council is loving this SDLT increase/potential choke off of BLT (not).
Exempting corporate investors obviously makes a farce of this as individual retail buyers will simply be replaced by pension funds and the like.
The pension industry has been encroaching more and more into the residential housing market and has certainly been lobbying hard. If the proposed exemption remains in place then it is clear that this lobbying has paid off as they've just been successful in having their competition eliminated.
I've been hugely against the commoditisation of the housing market on the simple basis that it is fundamentally wrong to allow excess investment capital into a market that impacts so absolutely and so directly on the poorest in society.
If the tax applies to all then I am in agreement with it, if however, it transpires that it is a move to eliminate private competition for the benefit of the institutions then it is the worst thing to happen to our private housing market since the banks were deliberately de-regulated to allow them to sell on their debt risk.
As someone who lives between two properties and owns BTLs for my children then this has clear ramifications for me but I recognise that I am part of the problem of what has become a grotesquely dis functional housing market due to excess capital being permitted free reign.
The pension industry has been encroaching more and more into the residential housing market and has certainly been lobbying hard. If the proposed exemption remains in place then it is clear that this lobbying has paid off as they've just been successful in having their competition eliminated.
I've been hugely against the commoditisation of the housing market on the simple basis that it is fundamentally wrong to allow excess investment capital into a market that impacts so absolutely and so directly on the poorest in society.
If the tax applies to all then I am in agreement with it, if however, it transpires that it is a move to eliminate private competition for the benefit of the institutions then it is the worst thing to happen to our private housing market since the banks were deliberately de-regulated to allow them to sell on their debt risk.
As someone who lives between two properties and owns BTLs for my children then this has clear ramifications for me but I recognise that I am part of the problem of what has become a grotesquely dis functional housing market due to excess capital being permitted free reign.
surveyor said:
There's a lot of people not able to buy who are able to afford to rent
They may be able to afford monthly payments that are equivalent to the rent they pay, but many (most?) are not able to raise the deposits that are required by lenders and regulators.If you lower these deposit requirements, you are in danger of another sub prime fiasco.
These taxation changes are not going to help the situation. What is needed is more house building.
Behemoth said:
They may be able to afford monthly payments that are equivalent to the rent they pay, but many (most?) are not able to raise the deposits that are required by lenders and regulators.
If you lower these deposit requirements, you are in danger of another sub prime fiasco.
These taxation changes are not going to help the situation. What is needed is more house building.
And stop 600,000++ people entering the country. If you lower these deposit requirements, you are in danger of another sub prime fiasco.
These taxation changes are not going to help the situation. What is needed is more house building.
DonkeyApple said:
As someone who lives between two properties and owns BTLs for my children then this has clear ramifications for me but I recognise that I am part of the problem of what has become a grotesquely dis functional housing market due to excess capital being permitted free reign.
I have a bit of an issue with what youve wrote, sorry :-)How are you part of the problem? Your life must dictate you need to live between 2 properties, maybe your choice but hey your making a living GOOD for you.
Your BTL's are for your kids AGAIN GOOD (your also providing a home for someone to live in who may not want to buy), that's my plan. I want to leave my kids something, your simply trying to protect your family. I don't have a pension a few BTL's would sort that. Its funny how pension companies are moving into the BTL sector and with this new rule wont have stamp duty to pay.
I had a property that I bought in 2007 for £168K. In 2011 I needed to sell it(job issues), couldn't was worth less than the mortgage (valued at £110k) so I opted to let it out. Rental income is £575, mortgage is £725.
My view is rather than default on mortgage do something now I'm a scummy t
t of a landlord :-)That house is for my kids or for us to move back into.
I currently live in the NE and work between Glasgow and the Northwest. Earning much more money but cant get a mortgage because i'm self employed. Stuck.... So im renting and paying £800/month.
Fortunately there are landlords out there who provide a letting service. What would I do if we wipe out BTL?
The simple answer is not tax the service providers, sort affordability rules and give people the ability to buy.
Heres an idea. Government to give developers money/grants to help FTBers... (20%) I think.
Why not give the buyer 10% and the developer 10%? everyone wins, this way all of a sudden and FTBer has a mortgage deposit... Its not hard.
This could go on for ever but i've said my bit..
Edited by 528Sport on Friday 27th November 09:50
528Sport said:
I have a bit of an issue with what youve wrote, sorry :-)
How are you part of the problem? Your life must dictate you need to live between 2 properties, maybe your choice but hey your making a living GOOD for you.
Your BTL's are for your kids AGAIN GOOD (your also providing a home for someone to live in who may not want to buy), that's my plan. I want to leave my kids something, your simply trying to protect your family. I don't have a pension a few BTL's would sort that. Its funny how pension companies are moving into the BTL sector and with this new rule wont have stamp duty to pay.
I had a property that I bought in 2007 for £168K. In 2011 I needed to sell it(job issues), couldn't was worth less than the mortgage (valued at £110k) so I opted to let it out. Rental income is £575, mortgage is £725.
My view is rather than default on mortgage do something now I'm a scummy tt of a landlord :-)
That house is for my kids or for us to move back into.
I currently live in the NE and work between Glasgow and the Northwest. Earning much more money but cant get a mortgage because i'm self employed. Stuck.... So im renting and paying £800/month.
Fortunately there are landlords out there who provide a letting service. What would I do if we wipe out BTL?
The simple answer is not tax the service providers, sort affordability rules and give people the ability to buy.
Heres an idea. Government to give developers money/grants to help FTBers... (20%) I think.
Why not give the buyer 10% and the developer 10%? everyone wins, this way all of a sudden and FTBer has a mortgage deposit... Its not hard.
This could go on for ever but i've said my bit..
Essentially, what you are saying is, as long as a person is satisfying their own personal wants and desires - everybody else can go hang.How are you part of the problem? Your life must dictate you need to live between 2 properties, maybe your choice but hey your making a living GOOD for you.
Your BTL's are for your kids AGAIN GOOD (your also providing a home for someone to live in who may not want to buy), that's my plan. I want to leave my kids something, your simply trying to protect your family. I don't have a pension a few BTL's would sort that. Its funny how pension companies are moving into the BTL sector and with this new rule wont have stamp duty to pay.
I had a property that I bought in 2007 for £168K. In 2011 I needed to sell it(job issues), couldn't was worth less than the mortgage (valued at £110k) so I opted to let it out. Rental income is £575, mortgage is £725.
My view is rather than default on mortgage do something now I'm a scummy t
t of a landlord :-)That house is for my kids or for us to move back into.
I currently live in the NE and work between Glasgow and the Northwest. Earning much more money but cant get a mortgage because i'm self employed. Stuck.... So im renting and paying £800/month.
Fortunately there are landlords out there who provide a letting service. What would I do if we wipe out BTL?
The simple answer is not tax the service providers, sort affordability rules and give people the ability to buy.
Heres an idea. Government to give developers money/grants to help FTBers... (20%) I think.
Why not give the buyer 10% and the developer 10%? everyone wins, this way all of a sudden and FTBer has a mortgage deposit... Its not hard.
This could go on for ever but i've said my bit..
Edited by 528Sport on Friday 27th November 09:50
The classic "I'm all right, Jack" world view.
Eric Mc said:
528Sport said:
I have a bit of an issue with what youve wrote, sorry :-)
How are you part of the problem? Your life must dictate you need to live between 2 properties, maybe your choice but hey your making a living GOOD for you.
Your BTL's are for your kids AGAIN GOOD (your also providing a home for someone to live in who may not want to buy), that's my plan. I want to leave my kids something, your simply trying to protect your family. I don't have a pension a few BTL's would sort that. Its funny how pension companies are moving into the BTL sector and with this new rule wont have stamp duty to pay.
I had a property that I bought in 2007 for £168K. In 2011 I needed to sell it(job issues), couldn't was worth less than the mortgage (valued at £110k) so I opted to let it out. Rental income is £575, mortgage is £725.
My view is rather than default on mortgage do something now I'm a scummy tt of a landlord :-)
That house is for my kids or for us to move back into.
I currently live in the NE and work between Glasgow and the Northwest. Earning much more money but cant get a mortgage because i'm self employed. Stuck.... So im renting and paying £800/month.
Fortunately there are landlords out there who provide a letting service. What would I do if we wipe out BTL?
The simple answer is not tax the service providers, sort affordability rules and give people the ability to buy.
Heres an idea. Government to give developers money/grants to help FTBers... (20%) I think.
Why not give the buyer 10% and the developer 10%? everyone wins, this way all of a sudden and FTBer has a mortgage deposit... Its not hard.
This could go on for ever but i've said my bit..
Essentially, what you are saying is, as long as a person is satisfying their own personal wants and desires - everybody else can go hang.How are you part of the problem? Your life must dictate you need to live between 2 properties, maybe your choice but hey your making a living GOOD for you.
Your BTL's are for your kids AGAIN GOOD (your also providing a home for someone to live in who may not want to buy), that's my plan. I want to leave my kids something, your simply trying to protect your family. I don't have a pension a few BTL's would sort that. Its funny how pension companies are moving into the BTL sector and with this new rule wont have stamp duty to pay.
I had a property that I bought in 2007 for £168K. In 2011 I needed to sell it(job issues), couldn't was worth less than the mortgage (valued at £110k) so I opted to let it out. Rental income is £575, mortgage is £725.
My view is rather than default on mortgage do something now I'm a scummy t
t of a landlord :-)That house is for my kids or for us to move back into.
I currently live in the NE and work between Glasgow and the Northwest. Earning much more money but cant get a mortgage because i'm self employed. Stuck.... So im renting and paying £800/month.
Fortunately there are landlords out there who provide a letting service. What would I do if we wipe out BTL?
The simple answer is not tax the service providers, sort affordability rules and give people the ability to buy.
Heres an idea. Government to give developers money/grants to help FTBers... (20%) I think.
Why not give the buyer 10% and the developer 10%? everyone wins, this way all of a sudden and FTBer has a mortgage deposit... Its not hard.
This could go on for ever but i've said my bit..
Edited by 528Sport on Friday 27th November 09:50
The classic "I'm all right, Jack" world view.
Why is it ok for big corporate to move into this sector? After all in your world everyone would be a home owner.
I'm a member of a few private property groups on facebook and attend regular meetings. I often see posts asking for people (property deal sources) to find landlords who want to sell their business.
Last night I saw a classic post "we have a client who wishes to purchase 50+ properties in the north, 70K-130k min yield of 7%" there are regular requests like this on a weekly basis.
Those are the people who need stopping or taxing, not your average "joe" who just wants a secure income.
I also note you have ignored my thoughts about giving first time buyers a 10% helping hand towards a mortgage. Most renters who wish to buy cant get a deposit my idea would completely solve the issue
Seems your happy for big corporate to take the money
Edited by 528Sport on Friday 27th November 11:38
528Sport said:
No its called looking after your family and securing your future
Absolutely - but it is, at heart, a very, very selfish view on life and essentially tribal i.e only the immediate clan matters. I would like to think that modern society has moved away from only wanting to care for the well being of blood relatives.
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