The Budget 2017: An Online Letting Agent’s Viewpoint

6 December 2017

On the 22nd November, the Chancellor of the Exchequer Phillip Hammond delivered his annual Budget ahead of the 2018/19 fiscal year. As the housing market continues to look increasingly gloomy in 2017 and beyond, the Chancellor unveiled a raft of proposals to help increase the housing supply and improve tenancy conditions – two things we as an online letting agent are keen to see delivered.

These proposals were central to this year’s Budget; the government have clearly acknowledged the areas in which progress is required, and are showing encouraging signs that the tide of our inflated housing market may soon begin to turn.

Here’s a quick look at Hammond’s proposals for the housing market:

Stamp duty

The headline reform of this year’s Budget saw the Chancellor abolish stamp duty for first-time buyers on all properties up to £300,000 in value, and the first £300,000 of all properties up to £500,000. Stamp duty is the tax that the government raises on the purchase of property. 

Increase of housing funding and supply

The Budget unveiled plans to further increase the amount that the government has set aside for house building proposals, up to a total £44 billion over the next five years. This aims to bring housing supply up to 300,000 a year, in line with the recommendations made by the House of Lords Economic Affairs Select Committee.

The committee predicted that 300,000 new homes a year would help moderate house prices.

Reform of council tax premiums

Currently, councils are allowed to charge a maximum of 50 per cent extra on top of standard council tax for empty properties. The Budget will allow them to raise this premium to 100 per cent. This means that those who own empty properties may now have to pay double the standard council tax rate.

This policy hopes to incentivise landlords to fill empty properties, thereby increasing the supply of housing, and alleviating inflated house prices and rents – at least that’s the plan.

Consultation on how to increase tenancy security

The Budget also proposed a consultation on how to incentivise landlords to provide longer, more stable tenancy contracts for their tenants. No details, other than the launch of a ‘consultation’, have yet emerged, but there is talk that this will likely take the form of tax incentives for longer contract tenancies.

What does this mean for the tenancy market?

At LetBritain, we think these proposals show potential to help alleviate the inflated rents and prices of our housing market. In particular, the proposals to incentivise long-term tenancy contracts could go a long way in improving conditions for tenants and offering stability for landlords.

As our CEO, Fareed Nabir was quoted in Mortgage Introducer as saying: “This is a win-win budget for landlords and renters in this regard, offering long-term stability and security to the market.”

He also told PBC Today that this reform would “have a trickle-down effect on the rental process, offering more financial manoeuvrability for tenants”.
Mr Nabir was also quoted in Property Wire and Agent Wow.

Online letting agents LetBritain

We like to think we’re ahead of the game as an online letting agent. We welcome these proposals – because it’s in everyone’s best interest to get our housing market working at its best.
In the meantime, if you want to get the best tenancy deal in the housing market we’ve got, then head on over to our sign-up page, so you landlords can find the best tenants, and you tenants can find the best properties.