Paragon mortgages commission independent report by the LSE

by Property 118

10:32 AM, 15th March 2016
About 3 years ago

Paragon mortgages commission independent report by the LSE

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Paragon mortgages commission independent report by the LSE

Paragon Mortgages, one of the original lenders to help develop the Buy to Let market, has requested the Chancellor halt any further financial attacks to discourage Buy to let landlords ahead of tomorrows budget. It calls for a comprehensive review of the UK’s housing strategy to be carried out to meet the needs of a growing population instead.paragon

This is backed up by forecasts that the UK’s population is set to increase from the current 65 million to 73 million by 2039.

Paragon commissioned an independent report carried out by the London School of economics. The conclusions in this report confirmed that the Private Rented Sector has a massive influence and role to play in the housing market, and that any reduction or decreased expansion in the supply of privately rented properties as a result of changes in mortgage interest relief taxation, Stamp Duty and regulation will potentially increase the pressure on rental prices and adversely affect household budgets.

Chief executive of the Paragon Group, Nigel Terrington, said “The government needs to instigate a thorough review of UK housing need in the context of the expected population growth. The size of forecast population growth is the equivalent of nine cities the size of Birmingham.

The private rented sector is an important provider of homes for people in the UK. For many years, successive governments have actively reduced the provision of social housing. This, together with other regulatory changes such as the Mortgage Market Review which has restricted mortgage credit to homebuyers, mean more people are turning to the PRS.

“There is real risk of lasting damage to the sector if the impact of the changes is not fully understood and particularly if the government continues to layer one measure upon another without a thorough and robust assessment of the progressive impact different measures will have.

“The PRS does not have a binary relationship with home ownership: holding back growth in the number of properties for rent will simply not increase home ownership and may increase costs and reduce amenity for tenants.

“In the context of forecast population growth, together with a current and projected housing shortage, the key requirement is for the government to create a stable policy framework that will encourage investment in the supply of good quality, affordable housing across all tenures, so that people can choose the best housing option to suit their lifestyle.”



Comments

Mark Alexander

10:53 AM, 15th March 2016
About 3 years ago

As I have been saying all along, investment into UK housing supply needs to be incentivised, not taxed into oblivion.

Our Government needs to take a much closer look at what other major economies are doing in terms of CGT relief to attract investment. He also needs to understand the consequences of his crrent policies by considering comparables from the lessons learned by countries such as Ireland and Australia after they tinkered with their PRS tax system in the way George Osborne in doing now.
.

Dr Rosalind Beck

11:45 AM, 15th March 2016
About 3 years ago

Reply to the comment left by "Mark Alexander" at "15/03/2016 - 10:53":

Absolutely, Mark. As we know, even the Treasury Select Committee has expressed concerns about the grave consequences for the economy of this unprecedented attack on the PRS in the UK. Paragon makes the important point that there is not a binary relationship between landlords and owner-occupiers; the real binary relationship is between owner-occupiers/first-time buyers and tenants. These are the physical occupants of housing and George Osborne is massively favouring OOs and discriminating against tenants in the most invidious and insidious way.

Trendo

16:59 PM, 15th March 2016
About 3 years ago

So you mean the emperor had no clothes on then ?

Colin Dartnell

9:00 AM, 16th March 2016
About 3 years ago

He won't listen, far to arrogant for that!

Michael Holmes

11:58 AM, 17th March 2016
About 3 years ago

There are a growing number of articles expressing the same response as all the previous contributors to this discussion,in the media. Howard Flight produced a very well balanced piece about the rental market in yesterday's Telegraph business section (16/03/2016). I don't subscribe to the on-line version of the Telegraph, but if anybody out there does so, it might be well worth reproducing it on this website. I see Osborne has seen fit to exclude the BLT market from any reductions in CGT that he has extended to higher rate taxpayers!!

Luke P

12:18 PM, 17th March 2016
About 3 years ago


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