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10:19 AM, 29th August 2015, About 9 years ago 94
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Dear Mr Freeman
A response was received this week to the petition to Government regarding the restrictions of finance cost relief to individual landlords. The key message seems to be that Government wishes to “level the field” for homeowners and landlords. I have given that a lot of thought, and on reflection I think I may have been wrong all along. I now agree the playing field should be levelled. I have listed how this might be achieved below:-
1) Homeowners do not receive tax relief of their mortgages at all. However, when they take a lodger into their home the first £7,500 of rent received is tax free. This should be extended to all rental properties, i.e. the first £7,500 from each unit upon which Council Tax is paid should receive the same £7,500 per annum tax free allowance.
2) When a homeowner sells their home the capital appreciation is not taxed. This should also be applied to each of their rental properties.
3) A homeowner is allowed £1million of IHT relief against the value of their home. This should be extended to equity in rental portfolios.
4) A homeowner is given the choice as to whether they should obtain a CP12 annual gas safety certificate. This should also be applied to tenants, not imposed upon landlords.
5) A homeowner is free to evict a lodger subject to providing “reasonable” notice, without having to refer to the Courts. This is very fair and prevents the Court systems from clogging. This should be extended to private landlords.
6) A homeowner is not required to protect a lodgers rent deposit in an approved government scheme. This should also be extended to private landlords.
7) Homeowners may choose to have as many people as they wish living in their home without the requirement to purchase a licence. If that home is considered to be overcrowded then Councils have the means to deal with that issue. The same rules should be applied to tenanted properties. Whilst the UK is subject to a Housing Crisis it is important to remember that every person needs a roof over their head. The finances of those people in need of accommodation dictates where they can afford to live. The solution to preventing over crowding and leaving people with no choice, other than to suffer in poor quality housing, is a simple one; provide them with affordable choices. The only reasons that people live in poor conditions is lack of choice and affordability. The cause of the problems associated with overcrowding, sub-standard and unsafe accommodation are quite obviously due to lack of choice. The solution to the problem is to increase supply of property, i.e. BUILD MORE!
8) Homeowners are not required to verify the legal rights to live in the UK of guests invited into their homes. Quite rightly, they leave this to the border agencies. The same should apply to landlords.
Every year that passes whereby Government allow new property development figures to fall behind the need for new housing should be considered a failure on the part of the Government. The blame for such failures should most certainly not be pointed back at society, or any section of it. Constant vilification of landlords is not addressing the true cause of the Housing problem, which is quite clearly the responsibility of Government . The only real power to control immigration and population growth rests with government, as does the development of additional housing.
I do not blame the current Government for the state of the Housing Market, only time will tell whether it is successful in solving the problem. The reason I voted for you, and the Conservative Party, is that I believe you provide the best hope of being able to solve the issues associated with the Housing Crisis and the economy. I have not judged you on the failures of all governments in the last three decades, I expect better of you.
Given that successive Governments have become so reliant on the Private Rented Sector I think the suggestions I have made above are fair. I sincerely hope you will agree and that you will also consider the following:-
1) It has become a lifestyle choice for several people not to own their own property, they prefer the flexibility associated with renting
2) Many people are reliant upon the PRS for work mobility reasons
3) A significant section of society are unable to obtain mortgage finance required to purchase their own home. This is due to being on low wages, in need of benefits so as not to be living below the poverty line or having a poor credit rating.
4) Government have stated they wish to reward hard working people by helping them to make provisions for their own future. Buy to let can be an effective strategy if it is not taxed and regulated into oblivion.
5) Government clearly acknowledge the UK has a ‘Housing Crisis’
My conclusion is that if Government are to be true to their word they must consider a root and branch overhaul of UK Housing and associated legislation and taxation policies.
Yours sincerely
Mark Alexander
Related Open Letters >>> http://www.property118.com/category/open-letter-to-mp/
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Cristian
14:30 PM, 7th September 2015, About 9 years ago
A market is about what you see but even more about you don't see. What I see is that hundreds of thousands of LLs are reading/participating in this discussion. I see that 'The Petition' was signed by around 20k, i.e. 10% of the readership of this blog.
So what is it that we don't see, i.e. we don't understand. Landlords are not fighting for their daily bread, complacency, etc ? It is so easy to sign The Petition that my first thought when I read about it was LLs will sign in droves simply because there is nothing to lose, it costs nothing and takes no time at all. Then why not just sign it even if one does not believe in it ?
I feel that Mr Market thinks this. Total PRS about 10-15% of the market (in units). Total undersupply in the market at least 10% (my guess). So let's say the most geared LLs are forced to sell, that would be say 5% of total housing market (to be extreme). But 5% sudden supply is not enough to balance the market. So the market continues to be under-supplied, and the rents go up. Basically the LL community thinks this is all for the good actually !
I am also puzzled by this 20k number of signatories to The Petition. Perhaps this is more or less the number of LLs really in trouble (some LLs signed simply because they think is right, but on the other hand there may be some LLs who never heard of it). It feels to me about 20k LLs are burning on this issue, if true then say each want to lighten up some, not all, properties, let's say 5 each, so we have around 100k properties coming up on the market over and above the 'normal' supply over the next 2-3 years, far less than first calculation. No big deal I would say, if my guess is right.
Some One
15:15 PM, 7th September 2015, About 9 years ago
I haven't signed the petition, as unfortunately I think it's pointless for the following two reasons:
1) Are there any examples of such petitions having an impact?
2) As I understand the rules of the parliament petition scheme, if the 100k threshold is reached a subject is considered for discussion. I would expect the conclusion to their consideration of holding a debate to be that as this is part of the Finance Bill it is already being exposed to parliamentary debate as the Bill passes through parliament, and therefore no extra action is required.
The lobbying of MPs (particularly in marginals), local authority landlord liaison people, etc, is likely to have more impact.
Dr Rosalind Beck
15:53 PM, 7th September 2015, About 9 years ago
Reply to the comment left by "Some One" at "07/09/2015 - 15:15":
Well, if you are a landlord I find it amazing you won't even put yourself to the trouble of signing a petition. I don't take that negative view of life and my contribution to the world.
Lisa S
16:28 PM, 7th September 2015, About 9 years ago
Reply to the comment left by "Some One" at "07/09/2015 - 15:15":
Hello Someone,
It's not so much that the petition by itself will have an effect, it's more of an holistic approach, that the more we raise awareness everywhere, including the MPs in Parliament,, the more likely it is that this new tax will be seen for what it is. Unjust! Not just for the landlords but the whole of the wider community .
So I would ask you, please, to sign it...if it gets us nowhere at least we will have tried .
Mark Alexander - Founder of Property118
16:53 PM, 7th September 2015, About 9 years ago
Reply to the comment left by "Some One" at "07/09/2015 - 15:15":
Have you signed yet?
.
Annie Landlord
17:11 PM, 7th September 2015, About 9 years ago
With regard to Graham's point about social housing providers buying up all the properties PRS landlords will have to sell, this seems unlikely, given that a growing number of housing trusts/associations are saying they will have to 'downsize' when the 1% cap on social rents come in. They are talking about redundancies and real fears that the cap will prevent any expansion or positive development. They are also saying they may not be able to offer properties to people on benefits because when they bring in affordability criteria, people on benefits wouldn't be able to meet the criteria. You couldn't make it up! The SRS and PRS will be so messed up tenants will be falling over themselves to rent whatever is available.
Mark Alexander - Founder of Property118
17:20 PM, 7th September 2015, About 9 years ago
Reply to the comment left by "Annie Landlord" at "07/09/2015 - 17:11":
That's what worries me too Annie, the only landlords who will take them will be the true criminal elements who ignore all regulation regardless. People need a roof over their head and if an overcrowded, unsafe mouldy old property or perhaps a bed in a shed is all that is available then sadly they will be forced to accept that. We already know that the local authorities in the areas with the worst housing issues often turn a blind eye. If they don't they have to deal with the problem but don't even get any of the fine money for successfully prosecuting at their expense. The whole system is bonkers!
.
Cristian
17:59 PM, 7th September 2015, About 9 years ago
Reply to the comment left by "Some One" at "07/09/2015 - 15:15":
May I ask you, is this issue going to impact you to the extent that you need to sell and/or move off-shore, etc, or will you be able to go through it albeit with lower profits ?
Some One
12:01 PM, 8th September 2015, About 9 years ago
On average the petition is adding about 1,000 people per day, limping along at that sort of rate shows that this is not an issue that has captured the public imagination. Compare it to the asylum petition that has been running half as long and has over 400,000 people (or the anti-asylum one that has garnered over 100,000 in a few weeks). Since it didn't achieve the groundswell in the first couple of weeks, I think it now does more harm than good.
As before, all these petitions do is ask for a parliamentary debate, which is happening anyway as part of the Finance Bill. Talking/writing to people (including relevant ministers and their shadows) who will be part of that debate is far more worthwhile than a meaningless box ticking exercise.
(As a landlord this may cost about £5,000 per year, as a tenant I should do better as my landlord is incorporated.)
Dr Rosalind Beck
14:54 PM, 8th September 2015, About 9 years ago
Reply to the comment left by "Some One" at "08/09/2015 - 12:01":
There's no point trying to discourage us from signing the petition. We already have. And what a strange thing to attempt anyway. We'll do whatever we need to, thanks, to get this reversed.