Some of the biggest landlords in Peterborough also happen to be councillors, Conservative councillors! They won't be happy with the outcome of todays BUDGET as George Osborne has cut mortgage interest relief on buy-to-let homes, in an effort to create what he calls a "level playing
field" between prospective landlords and those buying their homes to live in. The chancellor said the relief will be cut to the basic rate of income tax, which currently stands at 20 per cent. The measure, which will address "unfairness in property taxation", will be phased out "gradually" from 2017.
Genevieve Moore, a partner at chartered accountants Blick Rothenberg, slammed the move.
"This is likely to impact many of Britain's workers who have saved hard and invested in property to supplement their retirement. We could see a flood of buy to lets being sold as the squeezed middle bow out of the rental market," she said.
A local Peterborough resident commented: The release of buy-to -let properties onto the market will help some to finally buy a home of their own. Peterborough councillors who own vast numbers of run down rental properties don't really care about their tenants or the properties they own in this City. Its all about just how much rent can be squeezed out and the huge tax relief they can claim. All that is now ending, a good move from a Tory Chancellor even!"
In his Budget speech today, the chancellor said the relief will be cut to 20 per cent, from 40 to 45 per cent, in an effort to "level the playing field" between buy-to-let landlords and ordinary house buyers.
Experts suggest the move is a "significant change" for those with a rental portfolio - but how will it affect them? What's experts' advice?
Grainne Gilmore, head of UK residential research at Knight Frank, said those planning to purchase a new property will need to factor the new rules into their calculations.
"This could affect the offers they are willing to make."
If you're planning on buying a property, consider how much your costs will rise, adds Phil Nicklin, real estate partner at Deloitte.
"We could see buy-to-let investors feeling the squeeze and putting up rents. This would have a major impact on Generation Rent."
However, in good news for Airbnb enthusiasts, though, he also raised the limit on the "rent a room" scheme, which allows landlords to earn money tax-free by letting out furnished accommodation in their home, from £4,000 to £7,500.
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