Shadow housing secretary accusing Sunak of massive ‘Bung’ to Landlords

by Property 118

9:57 AM, 13th July 2020
About a month ago

Shadow housing secretary accusing Sunak of massive ‘Bung’ to Landlords

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Shadow housing secretary accusing Sunak of massive ‘Bung’ to Landlords

Labour’s shadow housing secretary, Thangam Debbonaire, has written an open letter to Robert Jenrick accusing the Conservatives of sneaking out a £1.3bn bung to second home owners and landlords in the Summer Economic Update.

This is despite the 3% surcharge still being applied to all second homes and residential rental property.

The letter dated 9 July 2020 says:

“Dear Robert,

I am writing to you after the Chancellor’s financial statement in the Commons yesterday.

Subsequent to the Chancellor’s statement, the Treasury revealed that the stamp duty changes will also provide a tax break for second homeowners.

The Treasury has confirmed that those looking to buy a second property, or buying to let, will only have to pay stamp duty at 3% up to £500,000, rather than the 8% from a quarter a million up.

I’m seeking to clarify why your government is giving such a large tax break to owners of second homes at a time of an acute housing crisis.

If someone bought a second home yesterday for half a million pounds, they would have expected to pay £15,000 more than they would today.

You’ll know that in total, since its introduction in 2016, around 29% of all liable transactions have been subject to the Higher Rate (of Stamp duty) for Additional Dwellings. The majority (88%) of HRAD transactions are on properties sold for under £500,000.

In 2019/20, 34% of homes bought were second properties meaning this policy could cost the Exchequer £1.3 billion. This could fund the immediate gap in local council finances, which the LGA predicts will be £1.2 billion by the end of the year.

At a time when we have an acute local government funding crisis, I question how the Government can justify giving a tax break to people already fortunate enough to own an existing property rather than giving councils the funding they need.

Over a million people are on council waiting lists whilst the number of new social homes has fallen by 80%. This money could be much better spent on truly affordable housing to buy or rent, rather than on a tax break for second homeowners.

The Chancellor had an opportunity to rebuild and invest in truly affordable housing to buy or rent. But he failed to take it. He talked about jobs but did little to address the skills shortage in construction sector.

Please urge the Chancellor reverse his decision to give a tax break to second homeowners. We are calling for clear action in the spirit of constructive engagement.

Yours sincerely,

Thangam Debbonaire, MP for Bristol West”



Comments

Gary Nock

10:33 AM, 13th July 2020
About a month ago

Typical landlord hating left wing marxist momentum idiot.

Kathy Evans

10:48 AM, 13th July 2020
About a month ago

You'd be hard pressed round here to find a rented house that was ever liable for stamp duty. Some of these idiot MPs need to be reminded that the rest of the country isn't London. So why isn't she pressing for a change in law so councils have to build new houses with right to buy money or an end to right to buy to increase social housing (instead of slapping one of the sectors that hasn't had a bail-out)? No doubt she hates all small businesses, too.

terry sullivan

10:50 AM, 13th July 2020
About a month ago

abolish social housing--its a giant scam

Pradip Thaker

10:57 AM, 13th July 2020
About a month ago

This person does not really understand that us private land lords are the ones whose filling the rental homes market gap.
The chancellor has done the right thing re stamp duty.
First time buyers may not have enough deposits as the lenders have increased the LTV.
Therefore that would slow the market.
Next most landlords like me were hesitated to increase their portfolio because of all the extra charges and the section 24.
So the stamp duty reduction will change our minds.
In fact it will help all the way round.

John Dace

11:01 AM, 13th July 2020
About a month ago

So company director.... you already have 1 van .... next one will be plus 3%. You have 1 TV, next one will cost you extra 3%. One car already? Next one 3%. Mr and Mrs you already have 1 Child.... pay extra 3% vat on everything for the next. Fair? This extra tax is purely an attack on the private rented sector. If the social rented sector was fit for purpose then there wouldnt be much of a private rented sector. But as there isn't, we need the private sector (now more than ever) so wheres the sense in killing it? We offer in the main, nicer, more appealing homes for a wide range of people happy with the arrangement. Stop persecuting us. I question the whole idea of subsidised housing anyway. The idea started to house people as a temporary fix who found themselves down on their luck (as per the whole social security system). Now it has become about encouraging the idea - “you owe me somewhere cheap to live” “ its my right that everyone else should pay for my life”. This ‘Great’ Britain has become ‘Take‘ Britain.

terry sullivan

11:12 AM, 13th July 2020
About a month ago

nearly all social housing locally goes to foreigners

Porky

11:25 AM, 13th July 2020
About a month ago

So what was JENRICK'S reply?

Monty Bodkin

11:40 AM, 13th July 2020
About a month ago

Reply to the comment left by Porky at 13/07/2020 - 11:25
File 13

Simon Williams

11:44 AM, 13th July 2020
About a month ago

A reminder if we really needed it that Labour's hatred of landlords and wealth creation generally is as visceral as ever. Only the labour party can turn a policy to maintain an existing 3% surcharge into a "bung to second homeowners."
I don't think many landlords will rush to buy now anyway (so 1.3 billion figure quoted by Labour probably wrong) but in the days when they did, it meant more homes being built not less. Landlord investment provided the crucial early stage financing to encourage developers to start building and a new development thus created would provide homes not only to private renters but also to homeowners and not for profit renting under minimum affordable rules.
Nowdays, what has kept developers afloat in the absence of landlord money has been help-to-buy - arguably one of the biggest and costliest bungs ever (reported in 2018 to be costing the taxpayer £7.5 million per day).

LAMB, Cashman, Brooks & Wonnacott

14:54 PM, 13th July 2020
About a month ago

Reply to the comment left by Pradip Thaker at 13/07/2020 - 10:57
Precisely! Somehow the perception is that we landlords have second "homes" for our own holiday use?! We are actually helping SOLVE the housing problem by providing homes for others? Our "second homes" are actually someone else's primary (and essential) homes. I'm not sure even the government quite gets this, let alone the opposition.

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