Rachael Reeves wants to increase tax on btl.

[caringcarer]

To me this sounds like more policy without thinking through consequences. I read an article today about a lady with 4 children being made homeless when her btl LL sold the property and local council had no housing stock to re-home her. Instead she had to spend months in temporary accomodation which was 2 rooms and 2 of her teenage children lived with their Nan. If the btl sector is squeezed any more surely most btl LL will simply sell up and then even less rental houses stock.

The answer is to build more social housing. Bloody sick of BTL. Housing should never be seen as an asset class.

Put the tax gained into building social housing for the woman with the kids.
Her landlord could have sold up for any reason with or without a tax change. She has basically v little security as a private renter

And I thought btl was seen as less of a good investment these days already because of tax changes made by recent conservative government?

I think btl isn't a great investment for someone who just owns a couple of properties anymore. Also really hard to get people out if they stop paying etc.

Like a PP I'd like to see much more social housing.

It’s a very very tricky one. They need the solutions in place before they introduce the stick.
I’m a long term renter. Do not underestimate the mental health impacts on me and my kids as a result.
It needs to be made unattractive so that swaths of stock isn’t hoovered up, but the government need to correct their mistake from selling off the social housing so that people have a home.

Arguing it’s unaffordable to do that now, is laughable given this is the situation they created, in every way. From selling off social stock, for bolstering the housing market in 2008, even the latest stamp duty initiative.

It would be interesting to see if raising interest rates could have the same affect, it would make leaving it in the bank more attractive and less attractive to take on mortgage debt.

40% tax on rental income is enough surely?!

@Doubledoorsontogarden

40% tax on rental income is enough surely?!

Only if you're a higher rate taxpayer?

There's a difference between buy-to-let to long-term renters and buying a second home and renting it out as a holiday home. The former provides homes for people who need to rent, the latter often prices local people out of housing in areas with limited housing stock. Surely it can't be beyond the wit of any government to encourage the former, while discouraging the latter?

And they definitely need to build more social housing. They sold off all the council houses, starting in the 1980s and never replenished the stock.

If we didn’t have so may buy to let’s, we’d have more housing. I hate them with a passion.

Is there any actual detail of this proposal? Ive googled it and can't find anything specific.

The former provides homes for people who need to rent, the latter often prices local people out of housing in areas with limited housing stock. Surely it can't be beyond the wit of any government to encourage the former, while discouraging the latter?

Where I am BTL does not need to be encouraged, new builds are bought entirely for rental. Any normal home is snapped up by btl landlords before any local person stands a chance. That was pre covid. Subsequently with the stamp duty, a lot of landlords have sold up, but that’s pushed another £150,000 on the price so locals are still priced out.

If you tax btls more, then rents would go up. A better idea would be to increase stamp duty for second homes and really increase it for multiple homes, closing the ltd loophole.

If you tax btls more, then rents would go up

I don't think this is right. Rents are set (in aggregate, by the market) by what tenants can afford to pay, not by what landlords want them to pay.

The BTL "industry" in this country is a disgrace. We need more social and affordable housing, not private landlords owning more and more properties and squeezing the maximum amount of rent possible out of individuals PLUS the housing benefit that is often required to top them up, coming out of the general tax fund.

Tighter regulation is more important. How many of these landlords aren't declaring to HMRC? How often are they actually caught and punitively punished? Why are foreign landlords exempt from paying tax?
Tighten it up properly and there will be no need to increase tax.

Ha, love the thought that you oppose this suggestion because you’re worried about the homeless.

Totally agree we need more social housing. But we need this BEFORE we start putting off the private landlords. There are nowhere near enough rental properties. People need somewhere to live NOW. The rental market is crazy already and people without a guarantor and a very well paid job are struggling to find anywhere at all that will accept them.

@Doubledoorsontogarden

40% tax on rental income is enough surely?!

Not when workers have to pay NIC on top whereas there’s no NIC on btl profits