Proposal to make BTL a time limited offer – Feedback request

11:26 AM, 16th October 2018, About 6 years ago 34

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Once more I am after landlords’ views – this time about a proposal put forward by the Centre for Policy Studies. In a nutshell it is this:

‘What we propose, therefore, is that the Government should make every buy-to-let landlord in the country a time-limited offer. For one year, if they sell up, they will get a CGT rebate worth 33% of the tax they would have paid, plus (in the case of those with only one property) a cash bonus of £3,000. The buyer will get the remainder of the rebate, as the core of a deposit – up to 6.66% of the value of the property, with them having to put in the remainder. (This is, emblematically, similar to the discount on the original Right to Buy.)’

To view the full article in Conservativehome please Click Here

I am looking for you to answer the following questions, numbered as I have them numbered, in the comments section below and to also give any views you have on this.

I have already used the data collected from yourselves last week “Straw Poll to combat further government attacks – Please help” click here which should be published in an article next week. I will let you all know when it appears so that you can see how useful your help has been. So if you can help once more, that would be great.

Questions:

If this policy came in for the tax year 2020-21 would you be willing to sell any property (assuming you could get a buyer) under this scheme? (yes/no)
How many properties would you sell?
What do you estimate the capital gains tax liability would be? In the case of more than one property, give the average for one property (if you are a higher rate taxpayer this will be 28% of the gain – to make it easy use the total gain from purchase price to sales value, ignoring allowances etc. so if you bought it for £100,000 and the sales value is £200,000, the amount of CGT due would be £28,000)
If you would sell, would it be likely that your current tenant would be the purchaser?
If you would not sell, why not?
What do you think about the idea (you may want to read the whole linked article before answering)?

Thanks very much for your help.

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Comments

Dr Rosalind Beck

12:17 PM, 20th October 2018, About 6 years ago

Reply to the comment left by Anthony Hawes at 20/10/2018 - 11:38
Yes, they quoted RLA research indicating that landlords would be more likely to sell if CGT was waived or reduced. That is not what this proposal is - it is far more about a big, arbitrary give-away without rhyme nor reason. And reducing CGT for landlords by a third or a half would only nudge it more to what it should be if landlords hadn't been exempted from the reduction in CGT which applies to everyone else. They think they can keep kicking us and then we will desperately accept some crumbs thrown at us if we agree to assist in their agenda. We are getting this 'beg us to help, whilst stabbing us in the back' attitude across both national and local government policy; and being treated as though they know what makes us 'greedy landlords' tick and so they don't have to consult us in strategies which 100% depend on our cooperation.

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Ahmad Jibril

14:37 PM, 20th October 2018, About 6 years ago

I would not be selling in 2020/21. The effects of S24 and Brexit would ensure that property prises would be at their lowest in 2020/21. To sell in that year would mean selling at the bottom of the market for 1/3 less CGT. It wouldn't be worth it. I would, rather, stay on for the higher yield (due to reduced rental stock) and the recovering property values beyond 2021.

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AJR

11:04 AM, 29th October 2018, About 6 years ago

Another ill conceived idea, with insufficient incentive after bottom line calculations. Even if it were a good deal which it isn’t, I wouldn’t sell for reasons previously mentioned ie a potential market reaction following rush to sell. I will wait it out thankyou.
So, it will reduce Rental Stock still further, not exactly a bright idea, when there’s already a huge supply and demand imbalance. And no, a building boom won’t sort it anytime soon and even then the so called ‘affordable housing’ will still be way way beyond the pocket of many.
And, of course we can expect the usual bias in favour of Social Housing sales who will of course get the best deals at the tax payers expense, and all at a time when the Gov is crying out for more social housing! To quote a line from a previous post, ‘begging us to help whist stabbing us in the back’ no way to treat a vital sector which houses some 3 million households.

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Alison King

15:43 PM, 30th October 2018, About 6 years ago

1. Yes. Not because of the policy but if the tenant was that in love with their home I'd consider it as long as it did not leave me out of pocket.
2. 0. None of my tenants are interested in buying the property.
3. £6k
4. No. They want houses with gardens and some have not been living in the country for long enough to qualify for a mortgage. Once they do they will either look for housing association properties or new builds.
5. My properties are in high demand as rentals and they are supposed to be my pension. Who is going to support me if I can't support myself?
6. Too much of a lottery. There is massive variation around the country and not all landlords invest for capital gain. The wealthiest landlords in the south east woukd benefit most and so would their tenants who would recycle the property back onto the rental market as soon as they could.

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