@JediGnot
Personally (as a landlord) I'd advocate -
(1) 5 year long ASTs - one month notice from tenant at any time after 6 months, 3 months notice from the landlord at any point after 4 years and 9 months.
(2) Rent caps and controls.
(3) Higher rates of tax on rental income than people pay on earnt income (so long as property companies pay at the same rate as individuals do).
(4) Punitive taxes on second homes and vacant property. Tax people at 20% of it's value per annum if they choose to keep it empty.
(5) Abolish stamp duty to encourage people to move.
(6) Introduce property value taxes on residential property to pay for abolishing stamp duty. Instead of paying 5% (say) stamp duty when you buy pay 0.5% every year. Paid by the property OWNER, not the occupier. Give people more of an incentive to downsize instead of hoarding family properties that they no longer need.
You don't have much knowledge of the lettings market or the law relating to it, do you?
- Theres not much demand for 5 year long ASTs (where did this arbitrary figure come from?) in many city centres which make up the bulk of the market. You would do better to designate by planning permission, certain "family type dwellings" or "long term rural lets" (although these are covered by agricultural tenancy laws for some part) rather than this rather odd, scattergun, reactionary approach.
- Rent caps and controls - leads to higher rents, lower standards and a shortage of properties, because as we all know, the rich are always exempt in some way or other. Probably by a rolling monthly renewal on a holiday let business I would imagine, or the "under the table" rents which are common in Swtizerland, to think of one example.
- Is already in place and has led to rent inflation, because mortgage interest cannot be deducted from tax bills, as with any other business. All this does is exempt large corporate landlords and catch out the small private landlords, many of whom provide a better service than the former.
- Already in place. If you had bothered to read above regarding the detailed example of the decimated property market in Aberdeen, which is so over-regulated, city centre property prices have halved in the last 5 years and many properties are standing empty. New landlords are discouraged into low yield markets in Scotland because of the near double stamp duty in place for second homes. Unless you're based overseas, of course.
- No government will do it. And even if they did, the difficulty of getting a mortgage and putting in place the legal transfer of properties still wouldn't compensate for all the loss of employee mobility you would get by discouraging people to rent for short periods when moving for work.
- Fine, but in no other country is it as high as 0.5% for less than 3 properties. In Holland, tax on rental property is based on an estimated figure for all houses with the same cadastral rating, so a landlord achieving a higher rent for a luxury, well located property is not penalised for working harder. There are rent controls, but they are in areas dominated by social housing. Much social housing is owned by non-profit making housing associations, not the profit making companies we have here, which point you ignore.
I actually worked out that if I bought a property to rent out in Norway, I would pay less tax on it than here, even taking into account the wealth tax there.
The problem is that people who suggest these punitive taxes on rental properties:
(a) don't have the breadth of knowledge of law and other European rental markets (which in Holland and Germany are far more over heated than here) or even living abroad, nor of the law. In Germany, you quite often have to put in your own kitchen when renting a property, and will be expected to put up with old fashioned decor and heating. In Holland, you would lose around 1/3 of the rental housing stock immediately if you applied the rules on safety relating to fire exits and staircases that apply in Scotland.
(b) They're often motivated by a desire to yield power over those they perceive to be "richer" than them, which they think unfair, rather than by altruism. I worked for a local authority and had to have meetings with people who used to basically come out with the communist workers manifesto, circa 1972. One actually said "all property ownership is evil" in a council meeting.
In Scotland, we have a growing problem of ex or related council workers setting up companies to service the additional rules we have on letting property here - rules which we see nowhere else in the world.
(c) People who advocate these draconian changes are often incapable of taking in information or education about the property market - ties into (a) above. We need people with more qualifications and more experience making decisions that affect peoples' lives in this way.
(d) People like you also think that converting to a company magically turns a landlord into a saint, particularly if they then do a little bit of social housing letting, when in reality, these often make the worst landlords of all, employing unqualified school leavers on minimum wage to do the dirty work, and of course paying low corporation tax and deducting all business expenses from the tax they do pay.