The government should raise the stamp duty surcharge on BTL purchases to favour those buying their own home, according to a new report from Joseph Rowntree Foundation (JRF).
The social change group believes the surcharge should at least double to effectively disincentivise speculative investment and help reset the housing market.
It suggests replacing council tax and stamp duty with an annual property tax paid by the owner rather than the resident, to moderate future house price rises.
The report also recommends removing tax breaks on short-term lets, which currently give landlords a �7,500 tax free allowance on rents, to discourage them from switching from long-term lets.
It describes the current housing market as 'where building stops, transactions stall, cash rich investors swoop in to buy up properties, rents continue to spiral and vulnerable homeowners are stuck in unaffordable homes'�.
JRF says if the situation continues, it will have serious consequences for the economy without a corresponding fall in house prices.
The government could empower councils, housing associations, charities and community groups to acquire stalled sites from developers and let councils declare Housing Pressure Zones where they can set rules about who can buy properties in particular areas.
This could be used to restrict investor activity where high demand for second homes or low demand is fuelling 'exploitative lets'�.
Toby Lloyd (pictured), one of the report's authors, explains: 'House prices have been far too high for decades '� pushing home ownership out of reach, distorting our economy, and making it harder to provide affordable homes to rent.
"As we enter another downturn, we must not waste the opportunity to lower house prices to a much more affordable level '� and keep them there.'�
Tags:
Comments