Spring Budget disappoints the property sector, again
Chancellor Jeremy Hunt described his Spring Budget as a tax-cutting one, however he let down the property industry by announcing the abolition of Multiple Dwellings Relief on Stamp Duty – which applies when buyers make bulk house purchases, writes Clive Scrivener, Partner at Wimbledon based Chartered Surveyors Scrivener Tibbatts.
The relief, which zero-rated bulk acquisitions, made purchases by investors of build to rent properties more affordable.
Reported here, Melanie Leech, chief executive of the British Property Federation, said: “Abolishing SDLT multiple dwellings relief will hit the build-to-rent sector at a time when the Government should be doing everything in its power to encourage more long-term investment into professionally managed rental homes. This will hinder rather than stimulate the efficiency of the housing market.”
Hunt claimed the abolition of the Multiple Dwellings Relief, which was in part designed to support the growth of the build to rent sector, followed an external evaluation “which showed no strong evidence the relief is meeting its original objectives of supporting investment in the private rented sector.”
However, Henry Moss, partner at law firm Ashurst, told CoStar: “The axing of Multiple Dwellings Relief is an unexpected blow to institutional investment in high quality rental housing. I’m surprised, as this contradicts the government’s professed wish to increase investment in new housing.”
Housing: key Spring Budget measures at-a-glance
- A second round of the Local Nutrient Mitigation Fund, designed to help restart schemes totalling 30,000 homes stalled by the nutrient neutrality crisis
- A change to Capital Gains Tax designed to support the housing market, cutting the higher rate for residential property disposals from 28% to 24%.
- £3m to match industry funding for a programme to attract more planners to take up roles in local authorities
The abolition of multiple dwellings relief will almost certainly have an adverse on the build-to-rent sector and is a punitive tax to build to rent housing.
It beggars belief that when Housing is – at last – so high on everyone’s political agenda the only meaningful change is to increase costs not lower them. The Chancellor offered no support for affordable housing, no help for first time buyers and next to nothing to encourage further investment in building new homes.
If you would like to discuss something related to a property valuation please contact Clive Scrivener direct via email at Clive@scrivenertibbatts.co.uk or call 020 8971 2983.
