To think people who own more than 3 properties should have a special tax applied to them?

[Calltheguards]

I'm just thinking with the housing crisis, should people really own more than 3 properties? I would assume it's a property portfolio and used to exploit renters. AIBU to think there should be a special tax applied to property owners who own more than 3 properties? Maybe tax them at a really high rate to discourage people from hoarding property.

They are essentially a parasite and should be taxed as such.

Work hard, pay tax on purchase of property, pay income tax on income, pay CGT on sale ...... three lots of tax and they're parasites.

Nah, better off not paying tax, living off benefits and not contributing any tax .... because they're not parasites!

@SuperLoudPoppingAction you sound horribly jealous.

What about where people inherit a home in an awful state and don't have all the money or time they need to do it up right away and they don't want to sell it in the run-down state?

I think in that situation the logical and most practical thing to do is to sell as is. Unless you're a professional at doing up houses or your estate agent is shit at marketing them, it doesn't really make economic sense for you to be the one doing it up.

If you really believe you have a unique ability to add value that other potential doer-uppers can't see when they put in their bids to buy, then in theory you can get the work done straight away by borrowing money or getting a business partner who contributes cash, but I'm doubtful that that's the most practical way forward.

Simply leaving the house as is for however many years it takes you to accumulate the cost of doing it up out of wages seems the least sensible approach, even if we weren't talking about this in the context of worrying about housing shortage.

Maybe if the property wasn't hoarded and sometimes left empty for numerous months in the year it could be purchased at a reasonable price by the renters who work in the community?

Ah yes, I can just see how all those second homes in, say Kensington and Knightsbridge will suddenly become cheap as chips for locals to buy when their owners are forced to give them up. That is EXACTLY how the housing market works.

landlord has no motivation to upgrade for changes

I don't make changes unless they are necessary and I own my home. My boiler is old but I won't change it until I have to. Why do I want to spend thousands (and send the old, perfectly good boiler to landfill) when I don't have to?

I do think there should be carrots to encourage singletons and couples in large houses to move into smaller ones.

Why? If I've bought my home why on earth would I want to move just so someone else can have it?

You are forgetting one big issue (bar the basic supply - demand thing and the fact that people who can't save xxx grand for deposit will not magically be able to save xx.x too even IF prices fell).

Every time there is a plan to build houses nearly whole neigbourhoods protest against it. People want to build more housing, but not "in their backyard" because of traffic and strain on local services, any area with green on it because we need green areas (agreet to extent) or instead of old half fallen buildings because "That's history right there! Don't touch it!"...

@Calltheguards I presume you rent then...... ?

No, as I have said up thread, I own.

If you used the tax for social housing than you would increase competition and the rents would be forced down.

How would that work then? Tax is already used for social housing. How does increasing spend (which the Gov could do now btw) increase competition in the rental market? I assume you mean the spend would go on building new homes for people on the housing list? (Bad for the environment - we do not have a physical shortage of homes in this country.) Given that those homes would be filled with social tenants in benefit, I can't see how that reduce overall rents.

Don't they teach economics in the U.K...

Stricter regulations around letting will mean that those landlords operating on fine margins will have to sell at a reduced price in order to avoid bankruptcy this will help to gradually bring down property prices

I doubt it!

@Calltheguards have you read my point that landlords DO pay extra tax? So what you're asking for already happens.

Your post implies everyone who owns a rental property is "exploiting" renters. Why is charging a fair market rent and providing someone with a home exploitation?

Pretty insulting to those of use who own/have owned rental properties and have done their best to provide decent housing for others.

I am somewhat admiring of the sheer conviction of the OP who has it all figured out, like there are not thousands of people in political parties, independent think tanks and serious economic organisations up and down the country, with qualifications and experience of housing issues, and who spend their working lives on this subject.

When all along the answer has been "oh, easy. Just tax people who have 3+ homes, job done."

And when renters have to pay higher rent and hiring a holiday cottage in the UK costs more, you'll all be back on here moaning again.

@butteryellow

Here's some info on it,

www.rla.org.uk/landlord/guides/minimum-energy-efficiency-standards.shtml

This released quite a few properties onto the market a year or so ago when it was coming into force. My memory of it was slightly off it came into force in 2018 and will affect all properties lower than e by 2020.

This government have made some terrible moves but this is one of the better legislation.

@calltheguards

YANBU - I completely agree. And would add - there's a lot of greedy bastards out there who never can have enough money to line their own pockets with at the expense of poorer people.

'Oh but we already pay loads of taxes' - really?

yabu

They know the answer too but the game is rigged in their favour. The current system will not last though, eventually something will have to change with the housing crisis.

I own my home and rent out 2 others. Because when my DH and I moved in together we couldn't sell our properties. Do you know why OP? Because there were too many new build estates with massive incentives nearby. Why spend £200k on my 1920's semi, when they can get a new build and pick the bathroom and kitchen and tiles etc. And the government will help to buy. So not only did we have to pay an additional £12k on stamp duty on our new home, we have to rent out 2 homes which is the most stressful thing. Chasing rent, sneaking in pets, smoking in the house, damage etc, plus the maintenance as I try to be a reactive and good landlord (even when the damage has been caused by careless tenants!) . We pay tax on the rent and it doesn't even cover the mortgages. But I would be classed as a parasite? Find me a couple of buyers OP and you can release both properties back onto the market. I don't want them. I don't want to be a landlord but I had no choice! So should I be punished further? Oh and to top it off if I do get a buyer then we will pay CGT too. Yeah, I feel like a winner!

OP, you said that 'there are many flats purchased in London as investment properties and left empty. That's not good for the environment as it forces the workers to commute.'

I agree. Those owners are not landlords though. They're often overseas investors, many of whom will never even visit the UK. It's just a part of their investment portfolio. The newspapers in Hong Kong (for example) used to regularly advertise off plan luxury flats in London to HK and PRC mainland investors who were never going to use or rent out the property. Then of course there's a lot of Russian money sloshing around the London property market. Some of it with distinctly dodgy origins but which seems to get around our money laundering laws.

Some countries (think Denmark is one) only allow 'foreigners' to buy property if they are actually resident in the country and planning to live in it, precisely to stop that kind of practice.

So I'd agree with outlawing that kind of property speculation altogether or taxing it heavily.

The tax rules around landlords though (I'm not one btw so no axe to grind) have got stricter and stricter in the last few years and they're now paying increasing amounts of tax (including a stamp duty premium, income tax, plus capital gains tax when they sell) with fewer allowances/options to reduce their bill.

Locally to me quite a few small landlords are selling up because the rules are changing again and they will get hit much harder for tax from next April. Anecdotally it's not families/individuals who are buying the properties though but corporate landlords are hoovering them up. If they get taxed more, they'll just pass on the costs to tenants.

I totally disagree. There's nothing wrong with renting (some of us prefer it) and landlords with many properties tend to be more professional and understand their obligations and tenants rights.

However, I think there should be a licence required to act as a landlord and an independent body a tenant can appeal to when experiencing a landlord acting illegally.

Because when my DH and I moved in together we couldn't sell our properties.

Couldn't sell at all, or couldn't sell for the price you wanted?

*YANBU - I completely agree. And would add - there's a lot of greedy bastards out there who never can have enough money to line their own pockets with at the expense of poorer people.

'Oh but we already pay loads of taxes' - really?*

Yes I pay taxes on everything, above an d beyond for second properties etc.

We've worked hard, never claimed a penny of benefits, not lived extravagant lives and decided to buy property.

So what??

Others may have had larger families, more holidays, more designer wear, more eating out. Chosen to invest more into the markets, ISAs, pension funds etc etc.

That's all fine but if you've chosen to invest in property then you're a greedy bastard... really!

And as said before we do fucking well pay additional taxes!!!

If I sell a portfolio of shares and make £100,000 after allowances I pay £20,000 if I were a high rate tax payer. On the same basis I'd pay £28,000 on sale of a second home.

I read an article about this rise of air bnb type places in London and the negative impact its having on the local communities as population is more transient

Also about how many landlords and agencies are working around rules about how long they can be let out something, v shady practices

I find it interesting that the best majority of replies to op are, you're jealous, you're stupid, you don't understand anything, fuck off basically. I think our society is hardening in many ways at the moment, in other counties too.

@ChickenPie wow - my heart bleeds for you

So what - you have had plenty of choices to make - you could sell the properties and get less money for them

You could have moved in to one of the properties and just rented out the other one. No one forced you to buy a completely new one and keep the other two.

And no - I have no sympathy for you 'chasing rent' and maintaining the properties as you should do anyway. WTAF? It's your choice!

Definitely. It's not about sour grapes (get a grip whoever suggested that). It's about fairness.

The country where I live has huge taxes on any properties you have beyond two. And it's fair. Because there are literally thousands of flats lying empty, areas that are ghost towns, and still more flats being built, despite no one living in them. Green belt being built all over and people unable to afford to buy. It's going to cause a massive crash soon.

Property as an investment is totally unfair to the majority of the population. Invest in something else if you want to, I don't care, but buying up tons of property does harm to so many people.