Our esteemed Chancellor clearly needs a ‘bit of a rest’ over the Christmas holidays since it appears that he has got a ‘bee up his nose’ in respect of Buy-to-Let investments. What on earth is going on at number 11 Downing Street? Perhaps he needs a back rub and some chamomile tea, to calm him down.
His first anti Buy-to-Let initiative was limiting Tax Relief to the lower Tax band on rental income that will ‘bite’ in 2017. Then, his second move was to impose a 3% Stamp Duty Tax Premium on Buy-to-Let investments in the last Autumn Statement and, as if this were not enough, he has now proposed two more impositions on this sector.
The first is that the Governor of the Bank of England be directed to limit the loan to value ratio of Buy-to-Let loans and the second is to get the Inland Revenue to impose on the letting agents the need to establish the provenance of the tenant, before a letting, in order to stop unwelcome immigrants arriving to this country and renting our precious residential property.
Who is going to pay the letting agent for doing all this extra work I ask you? Why not go the ‘whole hog’ and just ban Buy-to-Let investments altogether and be done with it?
Let us remind ourselves that Buy-to-Let investments have only started to explode mainly because private pensions have become so dull and uninspiring since successive governments have all reduced their benefits to such a ludicrous degree rendering them all but useless. After all, what is wrong with the Middle Class using a private pension to protect their family’s future in old age and using a Buy-to-Let investment to facilitate this in the alternative? The last thing I would have thought the Chancellor would want for this country is to have this sector of Society depending on The State for ‘hand-outs’ in old age.
Rather than take away more and more benefits, why not add back some Tax Relief on private pensions that would take the pressure off the desire to have Buy-to-Let investments as an alternative?
We all know that Buy-to-Let investments are ‘ballooning’ but rather than ‘choking off’ demand to protect the housing supply why not, instead, deal with the root cause not the result?
If the government wants to increase the supply of private and affordable housing they should take a ‘sledge hammer’ to the local borough planning apparatus and do a ‘root and branch’ reform of this.
Better still, let the DOE (Department of Environment) take over a majority of the planning adjudications from the local boroughs and then perhaps planning criteria will be the highest priority (as it should be) instead of localism, nimbyism, ecology, conservationism and the political aspirations of the Councilors themselves. There is an idea?
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