12:06 PM, 24th February 2023, About A year ago 6
A charity is warning of a ‘worst of all worlds’ downturn in the housing market and wants landlord limited zones to help restrict BTL and short-term let investors.
With the Budget due on the 15th March, a report from the Joseph Rowntree Foundation (JRF) considers the possibility of a serious downturn in the housing market and lists recommendations to minimise the impact.
Among the measures considered in the report are that the government should consider replacing council tax and stamp duty with an annual property tax paid by the owner rather than the resident.
The report suggests the removal of the current Rent A Room tax break on short-term lets, which currently gives landlords a £7,500 tax free allowance on rents, to discourage landlords from switching from long-term lets to other types of rental.
An increase on the stamp duty surcharge for investor purchases, removing tax breaks for short-term lets, and levying council tax on homes in new developments 18 months after planning permission has been granted, whether they are built or not.
The report also says that councils should be given the power to create ‘housing pressure zones’ where they can set the rules about who can buy properties in particular areas.
Darren Baxter, principal policy adviser at JRF, commented: “We are facing a housing downturn that will put vulnerable families and our country’s economic prospects into serious difficulty.
“The government must confront this head on and recognise that past approaches will not work this time.
He added: “Instead, the government must tackle both the short-term fallout from the housing downturn we find ourselves in and the deeper problems within our housing system.
“By acting now, and doing both at the same time, government will ensure we are better placed to come out of this downturn with a fairer, more secure and more affordable housing system in reach.”
The full report can be read here.
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