Could be done fairly easily via the tax system. Each additional property you own increases the income tax on any rent and the capital gains tax when selling it. Bump up council tax for empty properties massively too and the market should correct itself with minimal direct intervention.
Set it up so having a second home means paying more for it, having 3 or 4 or 10 means it’s not profitable to keep it at all.
I read an article a few years ago about how some luxury London flats were sold indirectly - you purchased a company (which did nothing) and gained all their assets (which consisted of only one flat). You didn’t own the flat, you owned a shell company which owned it; it’s the same problem as having the wealthy create companies to avoid income tax. I think massive taxation for extra property ownership is a great idea, but I have no idea how you make it work.
Okay, but how does it work when a company owns a house? If a property developer builds a load of houses, wouldn’t they be incentivised to sell the house for more to recoup the penalty to them?
I think if it’s a first time build you could work something out to not punish developers for building houses which take a little time to sell, but you’d also want to avoid developers building and sitting on properties. That will probably already happen though as they’ll want to recoup construction costs asap I imagine. For portfolio property buyers they’ll be incentivised to sell which is only a good thing.
It wouldn’t be because people owning multiple houses is not the issue. Going to have to paste my usual response from Reddit to people thinking that landlords and second houses are the problem.
And there are 27.8 million homes in the UK, and we are apparently short 4 million.
So we ban second homes and that releases almost 450,000 houses which is less than 2% of the housing stock and we are still short 3.5 million houses, now what do we do?
The EHS defines these as “homes that are primarily used as holiday homes (by family, friends or let to others as a holiday let) or are occupied while working away from home.”
This clearly doesn’t include regular rental properties, so I don’t see how it shows landlords are not a problem.
Well there are 4 million rental properties in the UK so your numbers don’t quite add up. A very significant number of properties are purchased and rented as investment assets. No one is saying that ending landlord property portfolios will magically fix the issue overnight, but it certainly adds inflationary pressure on house prices and prices normal people out from being able to purchase homes. Houses should be homes first, not speculative assets.
Through taxation policy it should be possible for a family to move home and rent their old one, or rent an inherited one whilst waiting to sell, etc without much additional burden. But we shouldn’t encourage private entities pricing out normal people from homes and forcing entire generations to only be renters.
The economic damage from high house prices and lack of generational wealth is way too expensive to allow this portion of the market to continue. Simultaneously we need to be building a fuckload more homes, yes, but there being other things to change shouldn’t dismiss other helpful ideas.
Could be done fairly easily via the tax system. Each additional property you own increases the income tax on any rent and the capital gains tax when selling it. Bump up council tax for empty properties massively too and the market should correct itself with minimal direct intervention.
Set it up so having a second home means paying more for it, having 3 or 4 or 10 means it’s not profitable to keep it at all.
I read an article a few years ago about how some luxury London flats were sold indirectly - you purchased a company (which did nothing) and gained all their assets (which consisted of only one flat). You didn’t own the flat, you owned a shell company which owned it; it’s the same problem as having the wealthy create companies to avoid income tax. I think massive taxation for extra property ownership is a great idea, but I have no idea how you make it work.
Okay, but how does it work when a company owns a house? If a property developer builds a load of houses, wouldn’t they be incentivised to sell the house for more to recoup the penalty to them?
I think if it’s a first time build you could work something out to not punish developers for building houses which take a little time to sell, but you’d also want to avoid developers building and sitting on properties. That will probably already happen though as they’ll want to recoup construction costs asap I imagine. For portfolio property buyers they’ll be incentivised to sell which is only a good thing.
That is far too lenient on the landleeches
Just seize them and kick them out on their arse
It wouldn’t be because people owning multiple houses is not the issue. Going to have to paste my usual response from Reddit to people thinking that landlords and second houses are the problem.
https://commonslibrary.parliament.uk/research-briefings/cdp-2022-0001/
https://citymonitor.ai/government/england-short-4-million-homes-here-s-how-we-can-build-them-3921
And there are 27.8 million homes in the UK, and we are apparently short 4 million.
So we ban second homes and that releases almost 450,000 houses which is less than 2% of the housing stock and we are still short 3.5 million houses, now what do we do?
This clearly doesn’t include regular rental properties, so I don’t see how it shows landlords are not a problem.
Well there are 4 million rental properties in the UK so your numbers don’t quite add up. A very significant number of properties are purchased and rented as investment assets. No one is saying that ending landlord property portfolios will magically fix the issue overnight, but it certainly adds inflationary pressure on house prices and prices normal people out from being able to purchase homes. Houses should be homes first, not speculative assets.
Through taxation policy it should be possible for a family to move home and rent their old one, or rent an inherited one whilst waiting to sell, etc without much additional burden. But we shouldn’t encourage private entities pricing out normal people from homes and forcing entire generations to only be renters.
The economic damage from high house prices and lack of generational wealth is way too expensive to allow this portion of the market to continue. Simultaneously we need to be building a fuckload more homes, yes, but there being other things to change shouldn’t dismiss other helpful ideas.