Taking George Osborne’s stamp duty and buy-to-let changes on the chin

Cinque Ports Motor Company

The Chancellor’s decision to impose a new levy on second homes and buy-to-let properties has been met with disappointment from the Tunbridge Wells business community.

George Osborne announced a three per cent surcharge from April 2016 in his autumn statement last week which should raise £1bn for the public purse.

Local estate agents were unhappy at the news, one describing it as ‘a real bore’ while another awaits to see the ‘devil in the detail’.

They worry buyers from London, who are retaining their properties in the capital to rent out but buying second homes in west Kent, may be put off from taking the plunge.

Rupert Connell of top end agency Knight Frank said: “It’s a real bore. It is what it is and we have to take it on the chin.

“It’s a bit of a blunt instrument and could cause the housing market to slow down and people may well decide not to buy certain types of properties. They will simply look at other vehicles to invest in.”
Mark Haffenden of Batcheller Monkhouse added: “Anyone who is interested in the buy-to-let market better get into it pretty quickly.

“A lot of London buyers are choosing to retain their properties in the capital and buy a second home in Tunbridge Wells, so there may be an effect for those people.

“We will, of course, be keeping eye on the situation but the devil will be in the detail, I suspect.”
Craig Harman, of Perrys Chartered Accoutants in Tunbridge Wells, claimed ‘landlords have come under attack’ with the chancellor’s announcement.

He added: “We were expecting more from this statement – only a few of the key announcements we were anticipating have been made so it is highly likely that the spring 2016 statement will have a bigger and farther reaching impact.”

Tax director of Tunbridge Wells accountancy practice Creaseys, Tony Grubb, also said the two measures ‘may be seen as continuing his attack on private landlords’.

Gary Jefferies, boss of Tunbridge Wells-based wealth management fund Panoramic, said: “The suggestion is that the cost will be absorbed by the seller not the purchaser. But this is combined with the reduction of tax relief on buy to let mortgages as well. So it may squeeze some landlords.”

The main points of the Chancellor of the Exchequer George Osborne, below, relating to housing and local government were as follows:

  • A new three per cent surcharge on stamp duty for buy-to-let properties and second homes from April 2016, raising about £1bn;
  • Restrictions on shared ownership to be removed and planning system reformed to deliver more homes;
  • London Help-to-Buy scheme to offer interest-free loan worth up to 40% of the value of a newly built home;
  • Plans to hand £2.3bn to private developers to build 400,000 new homes in England;
  • Local government to keep all revenue from business rates by the end of the Parliament;
  • Councils to receive extra £10m to help homeless people;
  • Local government spending, in cash terms, to be same in 2020 as 2015.

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