London Central Portfolio, a property investment consultancy, has set out a five point plan for the next government elected this week - and it wants a sharp reversal of the trend to intervention in property seen by recent governments.
Firstly it wants the new government to provide relief to buyers of new builds from the three per cent stamp duty surcharge on additional properties.
It says that although duty revenue as a result of the surcharge is up, sales in London are down 29 per cent with international buyers deterred by the additional levy. “With average prices starting at substantially more than the UK average, throttling the sales of expensive new builds will not provide more housing for aspiring homeowners” says LCP.
The consultancy also links the surcharge to recent JLL figures showing that new build starts in the capital have slumped 75 per cent.
Secondly it wants an announcement that current property tax legislation will remain unchanged during the next parliament - although London Central Portfolio does not explain how this squares with its request for a tax change in its first demand.
LCP goes on to say that the last five years have seen three successive increases in stamp duty, an Annual Tax on Enveloped Dwellings of up to £218,000, a non-resident Capital Gains Tax, reductions in mortgage interest relief for landlords and a new ‘look through’ non-domicile inheritance tax.
“Continuous Government interference has increased uncertainty, with Brexit amplifying a wait-and-see attitude” says LCP.
Thirdly LCP requests incentives for professional landlords to supplement much needed rental accommodation
The consultancy says private landlords have been disincentivised to remain in the private rental sector because of recent tax and duty changes.
“Bona fide institutional and professional landlords should be incentivised to provide quality rental accommodation. This will both meet the needs of Generation Rent and promote the UK’s position as the go-to destination for international professionals” claims LCP.
Fourthly, LCP wants greater regulation of what it calls “illegal short-letting” and websites such as Airbnb.
“Alongside genuine homeowners, unscrupulous landlords are taking advantage of websites such as Airbnb to obtain serial short-let tenants at the expense of long stayers. Less publicised, are the growing numbers of tenants themselves renting properties on a long-let basis, and then subletting at a profit without the landlord’s knowledge” says LCP.
It adds: “The next government will need to draw up properly conceived legislation.”
Fifthly and finally, LCP wants the next government to review increases in business rates - not directly related to residential property, but a priority for the consultancy which cites a recent Westminster council study describing “high streets as the ‘beating hearts of communities’ but small retailers are already disappearing with internet giants and chain stores taking over.”