With Budget Day looming, Henry & James, like other property professionals, have been trying to second-guess the Chancellor and come up with a few fiscal ideas of our own to help boost the property market, particularly in central London.
“It is anybody’s guess what measures George Osborne will announce when he gets to his feet in the House of Commons on 16 March, but here is our wish-list,” says James Bailey, Chief Executive of Henry & James.
- Some modest mitigation of the stamp duty increases announced in the Autumn Statement, are due to come into effect in April, and would be welcome. It is highly unlikely, but the Chancellor should take note of the much reduced activity at the top end of the market as a result of these increases.
- There needs to be greater recognition of the key role played by private landlords, who were clobbered in the 2015 Budget by the removal of tax relief on their finance costs, scheduled to start in 2017, and clobbered again by the hikes in stamp duty in last year’s Autumn Statement.
- While a U-turn on the removal of tax relief is not in prospect, some fine-tuning around the edges might encourage more landlords to stay in the market, rather than exit it altogether. Without a strong rental and buy-to-let sector, the property market may suffer – as the House of Commons Treasury Committee recently warned Mr Osborne.
- Changes in capital gains tax could also be introduced, to enable landlords to restructure their portfolios more easily.
- Business asset rollover relief could be allowed on the sale of residential property assets, so that landlords who want to stay in the market can sell under-performing properties and reinvest the proceeds without penalty.
- New houses in the capital remain a priority, and the Chancellor should use as many fiscal levers as possible.
- First-time buyers need as much help as they can get to move onto the housing ladder. Any new schemes aimed at the younger generation would be welcome.
- Britain is an entrepreneurial nation. Let’s support small businesses and those looking to start new enterprises. The Chancellor could cap business rates or offer concessions to those who run small businesses.
- Granlords are a growing area of the property market. They have
worked hard their entire lives. Surely, they should be offered
more tax breaks during their twilight years.
“Pigs may fly over Whitehall before the Chancellor does some of these things, but if he does just half of them, resists unnecessary tinkering and acknowledges the importance of the private rented sector, he will have our support,” adds James Bailey.