15:19 PM, 14th May 2012, About 9 years ago 1
Calls to boost buy to let by upgrading pensions to include residential property are gathering momentum in Parliament.
An influential select committee of MPs is urging the government to streamline pension and tax laws for landlords to stimulate investment in private rented housing.
The Communities and Local Government Select Committee, which includes MPs from all parties, wants self-invested personal pension schemes (SiPP) opened to buy to let investors.
Current tax laws bar retirement savers from including residential property in pensions, although property investors can shelter commercial property in a SiPP.
Lobbyists the Residential Landlords Association (RLA) welcomes the move.
“The crisis in the private rented sector shows no signs of abating. Faced with a chronic shortage of accommodation, many tenants are faced with too high rents and are left to simply accept whatever housing they can find,” said chairman Alan Ward.
“This report echoes the arguments we put to the committee and are putting to government to reform the regulatory and taxation system which is stifling new investment in the sector.
“The proposals we have suggested would help unlock renovation in run-down properties, bringing them back into supply, and lead to new homes being provided for let.
“We strongly welcome the support given in principle to this by the report and urge ministers to act on its recommendations.”
The committee also recommends the government supports ‘build to let’ initiatives.
“While it is right to consider the potential for large institutions to invest in the private rented sector, it is also important to remember that the sector is, and will continue to be, dominated by small companies and individual landlords,”says a report from the select committee.
“There are a number of issues facing those in the sector. We have heard that the burden of regulation and taxation has deterred landlords from expanding their businesses. While constraints on mortgage finance will continue to affect investment in the sector, the government could provide some support by taking steps to address this burden.”
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