The Chancellor Philip Hammond should scrap stamp duty because it would encourage more buy-to-let landlords to invest in the private rented sector, which in turn would boost the supply of much needed housing to rent, a leading trade body has recommended.
The introduction in April 2016 of the 3% stamp duty surcharge on buy-to-let and second homes has deterred many people from investing in the PRS.
The initial findings of a survey of over 3,000 landlords carried out by the Residential Landlord Associations’ (RLA) Private Renting Evidence, Analysis and Research Lab (PEARL) finds that 68% of private landlords were being put off purchasing any additional homes to rent as a result of the 3% stamp duty levy.
The measure was introduced by the now former Chancellor George Osborne to create what he at the time described as a “level playing field” between landlords and those buying homes to live in.
However, the extra stamp duty has left many landlords with little alternative but to pass costs onto tenants by pushing up rents, at a time when demand for private rented housing is only likely to increase, according to the RLA.
The RLA is calling on the Chancellor to use the Budget statement today to scrap the stamp duty levy.
RLA policy director, David Smith, said: “The previous Chancellor introduced the stamp duty levy to support first time buyers, yet the figures show this simply is not happening.
“Many of those looking for a place to live are facing a perfect storm – good landlords not prepared to invest in new homes to rent, whilst those same people are unable to access home ownership sectors.
“It is clear that the stamp duty levy is hurting but not working for anyone. It is time to scrap it.”