Another week come to an end, Let’s see what news items we had.
A housing free budget
We start with a negative story – there was absolutely nothing about housing in the budget. In fact apparently, he only mentioned the word housing once.
A lot of people in the housing industry are dismayed by this and are forecasting a worsening of the housing crisis as a result.
Maybe though Hammond thinks the government is going to benefit in some way? For example, it had been hoped that he would do something about reforming Stamp Duty Land Tax, but Eye reports that ‘money is rolling in‘ to the treasury.
On the question of landlords and tax:
A big tax hike is coming for landlords
Tax reforms which seriously affect landlords will start to kick in next month. Property Industry Eye has a feature today quoting Dr Ros Beck, a private landlord, who claims that the tax bill for some could almost triple. Landlords, she says, will effectively be paying at a tax rate of 67%.
She has produced a table which shows that where a private landlord is paying £9,200 tax today, after the reforms come into force in 2020 they could be paying £33,600. Whereas tax for landlords renting through a company or renting holiday accommodation will be unchanged.
This is not going to help the housing crisis any. You can see the full article and the table here.
NB We are running a tax workshop on 27 Apri where you can learn more about the changes and how to protect your position.
Massive disparity in letting agent fees
Another great story from Property Industry Eys is proof that there is a huge disparity in letting agent fees -in Brighton and Hove and in Bournemouth at least, where Generation Rent has been doing some research.
The fees range from nothing (Homes Direct and Urban) to £624 (Leaders) with various fees in between.
I hope they have all disclosed these fees to their landlords – as otherwise, under agency law, they could be vulnerable to a claim from the landlords for the fees to be handed over to them as being a ‘secret profit’.
Cutting benefit for the under 22’s
There has been universal condemnation of the Governments move to take benefit away from young people under 22. Our own Ben Reeve Lewis wrote about it the other day here, and Dawn Foster in the Guardian points out that it will take only 140 people to become homeless for the policy costs to outweigh savings.
She also comments
When you can barely afford to pay your rent and face eviction, despite working, it’s clear the system is broken.
Which I have to say I tend to agree with.
There is good coverage of this issue by the way from Giles on the Nearly Legal site.
Councils having problems with their water
Another issue raised on the Nearly Legal site is a worrying one for Local Authorities who have been re-selling water to their tenants. They report on a successful challenge to Greenwich, which is also reported here by barristers chambers Garden Court.
It looks like Local Authorities who charge tenants for water will either have to bring a challenge to the courts or refund any overcharge element to tenants.
One to watch.
Housing around the world
A couple of reports from overseas.
In Australia, there is a report from the Guardian that they are looking at using government bonds to raise cheaper, long-term finance for affordable housing to be deployed through an affordable housing finance corporation.
While in Trumps America, New York is worried that the federal funding it gets for its public housing funding is going to be cut significantly. Incidentally, I rather think that is how Trump’s father made his millions – so maybe Trump thinks they could cut the fat a bit?
What made me smile this week
This quiz in the Guardian about housing – although I didn’t do very well.
See how you do – it’s here.
Maybe Mr Hammond should have a go?