Property auctioneers have warned that the increase in stamp duty land tax, as announced in last week’s budget, could reduce rental housing supply.
In her first budget, chancellor Rachel Reeves announced a 2% hike in the higher rates for additional dwellings on second homes or BTL properties. This rate has moved from 3% to 5%.
In addition, the capital gains tax treatment for property investors has also changed. Reeves has raised the rates of this tax from 10% and 20% to 18% and 24% respectively.
Making this warning, NAVA Propertymark - the auctioneering arm of Propertymark - is calling for the changes to be revisited by the government as they could hinder rental property investment.
Stuart Collar-Brown, president at NAVA Propertymark, has said there is “little doubt” this will have an impact on investors who will likely lead the market as a result.
“The Budget will no doubt have mixed reactions, with some celebrating the unchanged CGT rates for residential properties but the increase in SDLT will surely have a negative effect on private rental sector stock levels and thus possibly increase rent due to further lack of availability,” said Stuart.
