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The Masked Tulip

Landlord Zone Forums And Possible 40% Cgt

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id start a new thread on this. i would be happy to do this. im really lazy tho , maybe someone could provide a template for everyone to use

INSERT NAME OF MP

House of Commons

London

SW1A 1AA

[or use constituency office address]

INSERT DATE

Dear INSERT NAME OF MP,

As a voter in your constituency, I am writing to express support for the Coalition Government's proposal to raise Capital Gains Tax on non-business assets from 18% to 40%, and to urge you do all you can to enact it as quickly as possible.

One of the greatest social and economic problems facing our country today is the cost of housing. The average cost of a home in the UK is now between four and eight times the mean national average income of approximately £24k per annum: in this constituency it is [iNSERT FIGURE]. Those on low incomes, or who subsist wholly or primarily on state benefits have their housing needs taken care of by the taxpayer, and those on very high incomes can afford housing at current prices.

However, the dangerous and unsustainable rise in the cost of housing during Labour's period in office has created a situation in which young professionals on an average income have little or no realistic chance of owning their homes (and those who do face far higher mortgage payments as a proportion of their income, and over a longer term, than their parents did). The result is that they are forced, long term, into the private rental sector, and in particular the insecurity and excessive cost of the Assured Shorthold Tenancy (AST) system.

When the 1988 Housing Act introduced the AST, the Thatcher government's ideological position was to help professionals become homeowners, which carried the expectation that no-one would need to live in private rented accommodation for an extended period of their lives. The house price rises that took place under Labour have deeply undermined this position, and have in effect transferred a large amount of wealth from the current generation of young professionals to that of their parents.

Gordon Brown's misguided and irresponsible tax raid on private pension schemes shortly after entering office in 1997 caused lots of middle income savers to take their money out of equities-based pensions (i.e. investing in the productive side of the economy) and into housing (unproductive). In particular, the amateur 'buy-to-letter' emerged during the early part of the last decade: these were typically professional couples in their 40s and 50s looking for long-term investment to fund their retirements. Large numbers of properties that would typically be purchased as first homes by young professionals were bought up by the buy-to-letters and rented to the section of society that previously would have bought them, denying them the security of home ownership and forcing them to use the money they should have been using building their futures in subsidising the lifestyles of their parents.

This state of affairs is undermining the social cohesion and economic productivity of an entire generation, and must be stopped. Under the current AST arrangements, tenants can be forced to move house every six months, with all the upheaval and expense this involves. Even if they don't, letting agents frequently charge several hundred pounds just to renew a tenancy agreement. Would you wish to establish your career and bring up a family in such living arrangements? Increasing number of young professionals are deciding that they cannot afford to, and as a result an increasing proportion of the birth rate is being accounted for by the benefit subsistent and unskilled immigrants, with all the economic problems that implies.

The imposition of a rate of CGT on second and BTL home ownership that fairly reflects the social and economic damage this activity causes is to be welcomed, and should be implemented as a priority. It will hopefully result in savers investing in productive sectors of the economy (e.g. equities-based savings vehicles that invest in industries and services), and not unsustainably inflating the cost of a basic human requirement. If this is not done, more taxpaying, educated young professionals will emigrate. The ones left behind will feel no sense of long-term commitment or belonging to the communities in which they live. Would you want to get involved in voluntary work, serve on a board of school governors, take part in a neighbourhood watch scheme or take an interest in the governance of your town if you knew that you could be thrown out of it in six months' time? An increasing proportion of today's young professionals don't and won't.

You are likely to receive a large number of complaints from wealthy members of the boomer generation, worried that the proposed CGT increase on their buy-to-let porfolios will mean that they'll only be able to afford two foreign holidays a year rather than three, and other such sacrifices. You should remember that our generation can vote too, and that the housing crisis caused by BTL is moving up the agenda as we get older and more inclined to engage in politics. I hope that you will stand firm and do all you can to bring this increase into law; and also to ensure that effective measures are put in place to prevent the owners of BTL properties from 'flipping' them to their main residence shortly before selling them, in order to dodge the tax.

Yours etc.

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The below forums should be of interest to HPCers - loads of posts on CGT.

I shall also email my MP. But I am seriously considering putting my portfoliio up for sale. Now before this new Law takes place.

As you said, many people have property as their pension and this is the case with me. Paying this tax would simply mean I would gain very little in the way of capital gain after the tax is paid and become dependant on the State.

As it happens I have suffered like we all have, by falling values, so, in 2008, when it was nearly time for me to capitalise on my investments, the recession occured. I thought I would hang on for another 3 -5 years and hope for a change of Government which has happened, but not as I expected.

I sunk all of a legacy I was left by my parents into property 10 years ago, and built up a decent portfolio to help me through my old age. It is now worth half of what it was at the beginning of 2008. If I sell, I don't get enough to see me through the next 20 years. If I don't sell now and wait for values to go up, then I am hit by this new increase in CGT.

So, I am damned if I do and damned if I don't

Has anyone in Government thought of the result of this with regard to the housing shortage?

I don't think so! Many landlords will sell up in the next year, and there will be even less properties for rent, and an even greater housing shortage...now what kind of Policy is this????????

http://www.landlordzone.co.uk/forums/forumdisplay.php?f=7

How the hell do you manage to end up with a portfolio that has halved in value over the last 2 years? I mean prices have dropped but you couldn't do that if you tried! Did he set fire to his portfolio or something? Even if he did buy 10 years ago it sounds like he soon won't have any capital gains to pay tax on anyway.

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It's not like the house is being bulldozed when they sell! It will still exist, it will still be able to house people.

They assume everyone else is as morally bankrupt as they are to see no problem with sitting on dozens of empty properties while the values go up.

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Why the rush to sell?

Surely they didn't buy them simply to sell them later?

Why not just rent them out and continue to make $MILLIONS?

It's not that they were speculating with spare money was it?

Seems like the longterm rental income thing isn't working out for him

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Check this comment out:

The poor are pretty well looked after aren't they. They already get an allowance & all their bills paid as a reward for not going to work.

How about not robbing from the enterprising. I started with nothing like any other working class person. Now I own a few properties due to wise investment.

That doesn't make me rich.

Bought them tatty & cheap & did them up. The so called 'poor' could do exactly the same any time if they choose, unless they have some genuine disability.

Cheeky b@stards! Is anybody going to post over there, then? Cheeky sods - enterprising, my @rse.

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Can anyone who is better at official statistics than I verify (i) that I've got the £24k average salary figure right - if there's an exact figure out there, it would sound more impressive, and (ii) find a source of info for the average income in a given town? If this isn't easily available, that sentence will need to be pruned.

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Letter

That's fantastic, but unfortunately I live in a dyed in the wool Labour area so there is little point sending it. I would be utterly unsurprised that my MP is one of the piggies are the BTL trough.

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Check this comment out:

The poor are pretty well looked after aren't they. They already get an allowance & all their bills paid as a reward for not going to work.

How about not robbing from the enterprising. I started with nothing like any other working class person. Now I own a few properties due to wise investment.

That doesn't make me rich.

Bought them tatty & cheap & did them up. The so called 'poor' could do exactly the same any time if they choose, unless they have some genuine disability.

Cheeky b@stards! Is anybody going to post over there, then? Cheeky sods - enterprising, my @rse.

I'll register later. Offer some *hugz*

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Hang about.

The Conservative-Liberal coalition agreement states that the alliance will “seek a detailed agreement on taxing non-business capital gains at rates similar or close to those applied to income, with generous exemptions for entrepreneurial business activities”.

Have I missed something? Aren't BTL/Landlordism a business anyway, and therefore will be exempt from this CGT change??

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Check this comment out:

The poor are pretty well looked after aren't they. They already get an allowance & all their bills paid as a reward for not going to work.

How about not robbing from the enterprising. I started with nothing like any other working class person. Now I own a few properties due to wise investment.

That doesn't make me rich.

Bought them tatty & cheap & did them up. The so called 'poor' could do exactly the same any time if they choose, unless they have some genuine disability.

Cheeky b@stards! Is anybody going to post over there, then? Cheeky sods - enterprising, my @rse.

Wonder if the so called poor are living in his properties and he is benefiting from a generous LHA?

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Just received the auto reply message. Looks like Vince been to busy to update. :D

Vince Cable MP

MP for Twickenham

Liberal Democrat Deputy Leader & Shadow Chancellor of the Exchequer

Agree with others this needs a new thread with letter and email contacts.

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The below forums should be of interest to HPCers - loads of posts on CGT.

http://www.landlordzone.co.uk/forums/forumdisplay.php?f=7

See how the piggies squeal, I love how some are writing as if they are doing the world a favour buy buying up all the cheap properties so 'hard working British families' are priced out and therefore forced to rent.

My heart bleeds for their potential pension schemes being reduced in value. If we lived in a half decent society there would also be extra rules giving tennants more security and rights to make changes to properties that would drive even more of these parasites out of the market allowing real people to be able to afford their own homes without mortgaging themselves up to the hilt.

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Lol, they've cottoned onto us 'losers' - see quote below:

I'm not sure the CGT hike will have much of an impact. Surely it will make landlords more likely to keep their properties for longer and just flush out the few that were planning on selling soon anyway. After all most are in this for the long term and the growth in value and rents over the next five to ten years will more than offset the extra tax. The losers at the housepricecrash website are getting over-excited IMO.

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That's fantastic, but unfortunately I live in a dyed in the wool Labour area so there is little point sending it. I would be utterly unsurprised that my MP is one of the piggies are the BTL trough.

Point taken, but these MPs will want to ensure that the wool stays dyed in their own colour. When the measure comes to Parliament, MPs - even those in safe seats - might just consider the profile of their constituents' feedback before making a decision as to how to vote.

Statistics: this document (link to PDF) gives the average salary as £24,292 and has a list of average salaries by major cities. York is more or less bang on the average, to my surprise: thought it would be significantly below due to the large number of tourist and retail sector jobs.

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  • 277 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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