"The Chancellor has a real opportunity to promote much-needed progression within the housing sector. Carefully planned housing policy is the cornerstone of every community across the entire UK and is fundamental to a successful economy"
- Nathan Emerson - Propertymark
With a strong focus from the UK Government on enhancing the UK’s productivity and growth, Propertymark has drafted realistic spending proposals that can potentially help increase the supply of privately rented accommodation and boost homeownership.
The propositions include help for last-time buyers by reforming Stamp Duty Land Tax, ending Section 24 of the Finance Act, and help for landlords and homeowners to achieve net zero via interest-free loans, and grants, with commercial buildings receiving extended VAT exemptions.
Stamp duty
Propertymark wants the stamp duty rate for first-time buyers, which is currently set at zero for properties worth up to £425,000 to remain in situ. In addition, the professional body would also like to see further support offered to first-time buyers to help them approach the property market.
For those aged 55 or over who are considering ‘right-sizing’ by relocating to a potentially smaller property, there is potential for HM Treasury to tap into a new source of revenue while increasing house sales and giving larger families the chance to live in homes suitable for their needs.
Section 24
Propertymark would like the UK Government to reverse Section 24 of the Finance Act, which would allow landlords to be treated as small businesses and claim 100 per cent of their mortgage interest when completing tax returns. Since the measure was introduced in 2015, costs for landlords have surged and dissuaded them from investing in the sector.
Propertymark’s report Impact of Section 24 on buy-to-let landlords in England discovered that 69 per cent of landlords surveyed had experienced an increase in their monthly mortgage repayment. The professional body fears that if the supply of rental properties is hindered by the retention of Section 24, then this will increase rents further and potentially lead to increased costs to welfare payments to help tenants facing rent arrears.
CGT
With much speculation that the UK Government is tempted to increase Capital Gains Tax, Propertymark has stated that HM Treasury could consider increasing the tax on profits made on the sale of buy-to-let properties to align with the higher rate of 24 per cent, irrespective of a landlord’s income bracket to avoid spurring landlords on to leave the market.
Energy efficiency
Finally, Propertymark has called on the UK Government to assist landlords and homeowners with their energy efficiency targets through a mixture of grants, loans, and help with survey costs, all of which should further support them to meet the Minimum Energy Efficiency Standards. The professional body suggested that such a measure would help boost economic growth by placing reduced pressure on the Warm Homes Plan and increase jobs in the construction sector if there is increased investment in retrofitting buildings.
Nathan Emerson, CEO at Propertymark (pictured), said: “The Chancellor has a real opportunity to promote much-needed progression within the housing sector. Carefully planned housing policy is the cornerstone of every community across the entire UK and is fundamental to a successful economy.
“With the population expected to hit 70m within the next five years, it’s imperative to have a strategy that upscales a workforce capable of delivering a sustainable mix of homes in key areas of demand. There must be very careful consideration on how available land is utilised moving forward, ensuring brownfield areas are fully prioritised before dipping into greenbelt land and that there is robust wider infrastructure to support such developments.
“Any proposed taxation structure must promote long-term investment in housing and ensure flexibility for those wishing to move to homes that are best suited to their needs. It’s also important that there is full evaluation regarding future ‘new towns’ to ensure any proposals drive success and deliver future-proof solutions for generations to come.”
