In the NRLA’s latest report, 37% of landlords claimed that they have refrained from selling property for longer than expected due to capital gains tax (CGT).
45% of landlords who have considered selling property strongly agreed or agreed that capital gains tax (CGT) was a factor in holding onto a property longer than envisaged.
Out of the total landlords surveyed, only 14% disagreed with the idea that CGT meant they had held off on selling a property.
The report also asked landlords how they would respond to CGT reforms.
The NRLA suggested to landlords a CGT break if they were to sell to another landlord — to ensure sufficient properties remain in the PRS.
Some 35% of landlords considering selling property said that they would act on this proposal and take steps to ensure property remained in the PRS.
The NRLA also highlighted that the tax system should encourage landlords to sell to tenants, and that CGT could be reduced if this was the case.
73% of landlords said they would at least consider this proposal.
The report stated that holiday lets qualify for Business Asse Rollover Relief (BARR).
If an owner of a holiday let sells a property and buys another property to let, they would gain relief on their immediate CGT bill.
Landlords were asked about the possible actions they would take if BARR was reformed in a similar was for the residential rental market.
When asked if landlords would take advantage of BARR if they could sell a property and replace it with a new, more energy efficient property, 27% said this would make no difference to their operation as a landlord.
However, 30% said they would look more closely at the proposal and 13% would take advantage of the policy with immediate effect.
