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Landlords call for 3% stamp duty levy on BTL property to be axed

NRLA says decision is 'no brainer' as it would add 900,000 properties to the private rented sector and raise £10 billion for the treasury.

Nigel Lewis

landlords

Landlords have called on the government to ‘take its blinkers off’ and scrap the 3% stamp duty on buy-to-let properties to incentivise landlords to supply an additional 900,000 homes to the private rented sector over the next ten years.

The National Residential Landlords Association (NRLA) has made the call based on new research by Capital Economics.

Modelling by the consultancy also shows that the additional purchase activity would generate £10 billion in additional tax revenue for the government, making it somewhat of a no-brainer for Rishi Sunak as the nation faces a chronic shortage of homes to rent.

Capital Economics also argues that, as young renters’ need for privately rented homes increases as owner-occupied and social housing fail to keep up with demand, between 100,000 and 230,000 extra homes will be needed every year within the PRS.

Dwindling supply

This, as many letting agents will know, if unlikely to happen given supply has been dwindling as some landlords exit the market.

Capital Economics suggests that without changes in tax or other policies, the private rented sector stock will decrease further by over 500,000 properties over the next ten years.

Ben Beadle TDS Northern Ireland“The Government needs to wake up to a crisis of its own making,” says Ben Beadle, Chief Executive of the NRLA (pictured).

“Taxing landlords out of the market serves only to cut supply, increase rents and make homeownership more difficult to afford.

“The evidence clearly shows that the supply of rented housing is declining as demand increases and will continue to do so.

“The Government is taking a blinkered approach to the issue, which is not helped by its reluctance to admit mistakes it has made in the past.”

March 15, 2022

2 comments

  1. I totally agree with Ben Beadle, the extra SDLT of 3% needs to be removed, as any extra cost, only translates into a higher cost for the tenant, who sits at the hard edge. When will the government understand that landlords are providing a service, a home for tenants, and the PRS needs more not less encouragement.

    • The additional extra 2% surcharge for overseas buyers is doubly unfair hitting ex-pats wishing to BTL in the UK. Its also due if they help a child out with a purchase and want their name on the deed. If a ltd co buy property in the UK and just one company director is from overseas the levy is payable on the whole sum as I understand it.
      For example if 5 beneficiaries of a property in a will wish to purchase in a new company to retain BTL deceased estate, the other 4 UK residents are still subject to the extra 5% TAX being applied – surely that cannot have been the intention?
      There are many circumstances where an exemption should be applied.
      My own are that I would like to invest some pension cash in either a UK property to part-time holiday let or in a BTL 2 bed with one full time ‘lodger’ either way so that I could use a room a few weeks annually myself to be near where my grandchildren now live, the same UK town where I was born and lived for over 40 years before moving overseas. The 5% EXTRA SDLT on top of the SDLT has made it prohibitive even on a modest priced ‘home.’

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