Another leading industry peer has urged the Government to show more support for the private rental sector by removing recently introduced tax changes.
Laura Lamb, director of The Mortgage Company, penned an article in the Mortgage Finance Gazette stating that she would like to see the removal of the 3% stamp duty land tax charges on buy-to-let property.
Buy-to-let mortgage drops
Lamb feels that sales of buy-to-let mortgages have fallen sharply since the tax changes-coinciding with the shortage of the homes in the lettings sector.
In her article, Lamb noted: ‘My business has seen a sharp decline in the number of clients buying to let and also doing let to buy. Some may attribute this to Brexit but it is my opinion that most of this is due to the massive changes in the buy to let regulation and taxation.’[1]
‘There is always going to be a need for rented properties, whether you live in one on a short-term basis or more long term. Punishing investors who own one or two properties that simply want to plan for their retirement and offer reasonable rents to good tenants is not the answer,’ she added.[1]
Mortgage chief urges Government to abolish stamp duty
Portfolios
In addition, Lamb feels that the surcharge should be aimed at landlords owning more than three buy-to-let properties, instead of one. This, she feels, will see professional landlords bearing the burden of extra tax, instead of amateur ones.
She warns: ‘Responsible lending is very important and I fully support that but stress-testing mortgages rates at 5.5% interest rates with a rent cover of 145% is just ridiculous and will massively limit lending.’[1]
‘I would focus more attention on offering more assistance to those trying to buy. The Government has introduced the Help to Buy ISA but it’s only available if you are purchasing a property under £250,000. Most first-time buyers in London and the south are looking at purchase prices in excess of this so they instantly lose out,’ she concluded.[1]
[1] https://www.lettingagenttoday.co.uk/breaking-news/2016/11/hands-off-buy-to-let-mortgage-chief-tells-the-government