Agency boss calls stamp duty surcharge 'a government own goal'

The chief executive of Andrews Property Group says the government’s three per cent additional homes stamp duty surcharge on buy to let properties - introduced a year ago this week - is effectively leading to a reduction in the rental supply.

Writing for the Features section of Letting Agent Today, David Westgate says he was recently at one of his firm’s Surrey branches alongside which there is a development of 10 new-build flats. 

“Ordinarily, in times gone by, I’d have expected to see over half of these to be purchased by investors. As it is, just one has been bought by a landlord” he says.

As a result, whereas many developers would bank on a third of their units being purchased by buy to let investors, with this no longer the case some developments are being scaled back or postponed, he claims. 

“Whether a seasoned investor or perhaps a more casual buy-to-let landlord, in many cases the three per cent surcharge is simply putting them off further investment - which is, of course, exactly what the government intended” he says.

He adds: “What I don’t believe the government intended, however, was to reduce the number of properties available for tenants who wish, or need to rent. Renting is important. A vibrant economy relies on a flexible workforce, able to nimbly move to where opportunities lie and where there is a solid supply of affordable property to rent.” 

Westgate says the move has culminated in the government scoring an own goal by reducing stock in a vital part of the housing market.

You can read the complete article here.