Private Rental Housing – A Hole In The Bucket

Private Rental Housing – A Hole In The Bucket

10:43 AM, 4th October 2016, About 6 years ago 30

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If you are already aware of the problem and can’t be bothered to read this entire article please feel free to skip to the bottom to read our “plan of action”. Private Rental Housing - A Hole In The Bucket

It is all very well that media are recognising the Government experiment to introduce the 3% Stamp Duty levy on second homes is failing but that’s just part of the story.

Osborne’s Stamp Duty levy has resulted in less duty being collected which might put pressure on Hammond to reconsider that.

The backlash from industry bodies such as RICS, conveyancers, estate agents etc. is all helping to make the case against the Stamp Duty levy but from my perspective it’s all too short sighted.

The organisations calling for a reversal of the Stamp Duty levy are only doing so because that’s what is affecting their business today. The real problem is going to be the increasing number of people who will find themselves homeless as other tax measures begin to bite.

Let’s pretend the Stamp Duty issue is resolved and that investors start piling into the market again. Those affected today might see this as a win, HM treasury will certainly be happy if Stamp Duty receipts increase again and in the short term there will no doubt be celebration.

The new investors will enter the market with their eyes wide open and many intent on building property portfolios will do so in a Limited Company. Let’s face it, they be daft not to, especially if they intend to borrow money! After all, why would any business elect to invest in a structure which prevents them from offsetting finance costs against income? It’s pure madness, no other business except for private landlords is taxed on the basis that finance costs are excluded as expenses.

Private Rental Housing - A Hole In The BucketThe hole in the bucket

If the Stamp Duty issue is fixed then investment into UK property will undoubtedly rise. However, hundreds of thousand of landlords who committed to investment before April 2015, when George Osborne first announced the restrictions on finance cost relief, will remain trapped into an ownership structure which is no longer viable. There may only be a few hundred thousand landlords affected but between them they own at well over one million properties.

As the bucket fills with new investors, unaffected by George Osborne’s tax policies, the number of properties owned by private landlords will reduce. To put it another way, those affected by George’s policies will sell up, hence the “hole in the bucket”.

Why is it that Government refuse to recognise this problem?

A headline in The Guardian today reads “UK faces shortfall of 1.8m rental homes

Err …. #ToldYouSo!

This is what happens when a Conservative Chancellor with a history Degree implements tax policy on private rental housing devised for the Green Party by a Geography graduate who just happens to have a posh Daddy.

On a more local level we are seeing headlines “MPs in dispute over £1 million Travelodge bill for homeless families

What a mess, and to think that Shelter fully supports the legislation that is causing this.

Why is it that Shelter, one of the biggest charities supposedly fighting homelessness cannot see beyond their noses?

A cynic might suggest that Shelter are nothing without a homelessness problem and landlords to attack!

The numbers of evictions will rocket when the new landlord tax regime kicks in. God help anyone claiming benefits to pay their rent. Benefits caps and Universal Credit isn’t helping help either. Private landlords will not be able to afford to continue renting to benefits claimants. Instead they will do what most Housing Associations are doing and rent to working folk. They will also end tenancies which are no longer profitable.

Does anybody have any idea where the most vulnerable in society will live? Councils are already using Travel Lodge for emergency housing because they have nowhere else to put people!

Does anybody really think Government Housing Policy makes any sense at all?

Plan Of Action

We want to communicate with every high level housing officer and centre of influence in local Government.


Because the homelessness problem is going to end up on their doorstep. It is the local council who are going to be responsible for the clean up operation when the Government war on landlords (read indirect stealth tax on tenants) takes full effect.

Ever since the Summer 2015 Budget a team of 14 academics, all regular contributors to the Property118 forum, have committed their spare time to researching the consequences of George Osborne’s tax policies on the Private Rented Sector. The vast majority of the research provided to “Axe The Tenant Tax” campaign has been presented by this group.

Dr Rosalind Beck head up this research campaign and the members of Property118 have pulled it all together into a substantial report.

Our goal is to have this published and sent to every local Government officer with influence over housing policy. Educating those people is another route to putting further pressure on Government to re-think consequences of the tax policies introduced by George Osborne.

To achieve this we need to raise funds.

The more money we raise, the more we can do.

We trust we can rely on your support?

PS – when you make a pledge please leave a comment below and note the amount of your pledge. It will encourage more people to contribute and provide an indication of the running total of funds raised.


Mark Alexander - Founder of Property118 View Profile

11:08 AM, 5th October 2016, About 6 years ago


So far we have raised £375, the largest donation to date being £100.

That's a great start!

Please share this article on Facebook etc. to help increase awareness.

Saturday and Monday are our busiest days so we will report gain on Tuesday or Wednesday with a further update.

The funds raised so far are more than enough to commission a design company to create a highly professional PDF and print templates for printed reports.

We are hopeful that we will raise enough money to be able to:-

1. Call every Council and speak to the Chief Housing Officer and the Council Leader to explain that we are sending him/her the report
2. There are 433 principal authorities in the UK: 27 county councils, 55 unitary authorities, 32 London boroughs, 36 Metropolitan boroughs, 201 districts, 32 Scottish unitary authorities, 22 Welsh unitary authorities, and 26 Northern Ireland districts.
3. To send printed copies by post, with a good covering letter
4. Follow up with a telephone call on the afternoon the report should arrive with a view to diarising a further follow up call to discuss feedback and an action plan
5. Follow up call to discuss feedback and action plan for the Council, e.g. talk to media
6. Further follow up call to discuss progress/results

We don't have the human resource at Property118 to undertake a project of this size so we will have to outsource it.

The purpose of the above strategy is:-

• To increase awareness
• To convince Councils that the consequences of homelessness caused by s24 will end up on their doorstep
• To encourage Councillors to raise the issue with their regional media with a view to creating more media such as that witnessed this week in Peterborough
• For the above joint efforts to raise awareness amongst landlords and tenants who would otherwise be unaware of the problem
• To increase political pressure from media, landlords and local Government

Our best guess is that to outsource all/most of the above we will need to raise circa £17,000 to allow for a budget of circa £25 per targeted centre of influence.

It is absolutely vital that we leave no stone unturned in terms of recruiting additional support. If we do the same things we will get the same results (at best).

We must reach the hearts and minds (and the wallets) of more than those who have contributed to the #TenantTax Judicial Review fund so far. The average donation was less that £200 and only £180,000 in total has been raised so far. Most of that has been spent to get this far. There is now way we can expect the same people to chip in up to a further £600,000.

Given that up to £600,000 may be required to fund the Judicial Review alone, and that there is no guarantee of a result, we must do more. The above campaign is part of that. It will continue regardless of the outcome of the Judicial review permissions hearing.

Many more people need to be encouraged to join this fight in order to add pressure on Government from every possible angle.

On other matters:

We are hopeful that permission for the JR will be granted tomorrow as we have had a huge cheque printed to hand to Steve and Chris at the Property Investor Show at ExCel on Saturday. The cheque will be for £11,000 which is the largest single donation to the #TenantTax Judicial Review Campaign to date. Hopefully our donation will embarrass other trade bodies into doing more. After all, Property118 Action Group are the new kids on the block, so to speak!

In the event of permission for the Judicial Review not being granted we will offer Chris and Steve the opportunity to take over the above project so that we can still present them with our cheque. If permission is granted for the Judicial Review to proceed Steve and Chris will have their hands full so we will continue to run this campaign.

Whatever the outcome after Thursday, rest assured, we we continue campaigning!

To make a donation to this campaign please scroll up to the main article on this page.

Rhett Costin

11:21 AM, 5th October 2016, About 6 years ago

Hi ,
Donated £15. It's unlikely I personally will be affected by clause 24 as I only have a small income and not many properties, but it is the injustice of this I object to and am therefore happy to chip in. Good luck guys..!!

Carole Stanton

13:38 PM, 5th October 2016, About 6 years ago

I pledged £25, every little helps.
I only Have 3 BTLs, which don't make any profit at the moment. This was going to be my pension. If I'm forced to sell, three families on benefits will be out on the streets.
Good Luck, lets hope we win.

Richard Harrison

14:26 PM, 5th October 2016, About 6 years ago

I have donated £25 and have previously given money to the Axe The Tenant Tax campaign as this is by far the biggest threat to my business. I have not been sure whether donating money here or direct to Axe The Tenant Tax was the best way to ensure this case is fought.

Paul Arnold

14:39 PM, 6th October 2016, About 6 years ago

With the Judicial review into S24 now disallowed this campaign is even more important. All those you supported the Judicial review now please contribute to this as it is our best chance.

13:59 PM, 8th October 2016, About 6 years ago

I pledged £10.the 3% also has an effect on the renovation market,it can make a property too expensive to buy and bring up to standard ready to goback on the market,especially at the lower end of the market,where the margins are tightest


18:49 PM, 8th October 2016, About 6 years ago

£20 pledged.

TonyProperty118 Orchard

11:31 AM, 9th October 2016, About 6 years ago

Have £30 of my tax-paid personal money. 🙂
My small portfolio is my pension because I didn't like the exorbitant charges from my pension (which were taken whether the value went up or down).
Now it seems the government is trying to do the same with my property business!

Anne Nixon

20:49 PM, 9th October 2016, About 6 years ago

£30 pledged to this excellent cause. I tried to do my bit in a practical way by emailing all major politicians and meeting my (Conservative) MP but to absolutely no avail, just had the 'level playing field . . ' rubbish spouted back as if read from a script.

Still cannot believe they cannot see the obvious outcome of their policies? Ludicrous!!

Anyway, best of luck guys, we're rooting for you and many thanks for all your efforts.

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