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Government's plans to solve housing crisis still flawed

Small landlords pushed out of sector by higher Stamp Duty Land Tax rates

Autumn Budget 2024

Today’s Budget does not solve the problems with the Government’s plans to end the housing crisis, or help small landlords.

Heather Powell, Partner and Head of Property said:

Buy to Let landlords face another challenge as a result of the increase in the Stamp Duty Land Tax (SDLT) higher rate.

The sector is rapidly becoming one only for professional landlords, buying properties ‘in bulk’ from developers, who can benefit from the economies of scale and commercial rates of SDLT.

However, landlords with a couple of properties held in their own name will welcome the freezing of the CGT rate on the sale of their properties at a maximum of 24%, and may will be considering that this is the time to sell.

£3.1bn of funding for the Affordable House Program, the Government Fund that makes grants to fund low-cost rental homes, sounds as if it should deliver thousands of new homes. But if this represents a subsidy of £50,000 per home this will only deliver 62,000 affordable homes; a drop in the ocean when the target is 1.5m new homes, or indeed the affordable homes needed in the UK.

A more imaginative approach to the delivery of affordable homes, including the release of surplus government land and ringfencing of these homes from the Right to Buy regime is essential to deliver, and retain, the number of affordable homes this country needs.

The increase in the Stamp Duty Land Tax (SDLT) payable on second homes by 2%, combined with the increase in Council Tax that can be charged on second homes, will be welcomed by locals in holiday areas – who will hope that there will be a reduction in competition for homes, and a realignment of the price to a level that can be afforded by them.

Heather added:

The rates relief for Business Rates for the Leisure, Hospitality and Retail sectors is very welcome for 2025-26, but the need for a complete overhaul of the commercial rating system is overdue by over 20 years – the current system does not reflect the modern business environment, this annual sticking plaster approach needs to be reformed over the life of this parliament.

Would you like to know more?

If you would like to discuss any of the above, please speak to your usual Blick Rothenberg contact or Heather Powell using the form below.

Contact Heather

Heather Powell
Heather Powell
Partner, Head of Property and Construction
View Heather's profile