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15 Houses To Avoid New Stamp Duty Law On Btl

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AIUI there will be a consultation on possibly allowing corporates with 15+ properties an exemption from the SDLT surcharge.

As long as they don't allow individual landlords looking to incorporate off from paying it on incorporation I don't think that's such a big deal. As I think you suggested on one of the other BTL/AS threads many will find it impossible to transfer to a limited company as they simply don't have sufficient equity in their existing portfolio to secure corporate funding; and as Bland suggested on the BTL Stampede thread those that do secure corporate funding may well be being lined up to be the first under the Basel III bus (which, if my understanding is correct, is in any case likely to raise market rates more steeply for corporate BTL by assigning it a 120% risk weight, as opposed to a - still massively elevated from current levels - 100% risk weight for individual non-consumer BTL).

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My view is it will tightly apply to pension funds, new corporates snapping up BTL HMOs around unversities (into the HPC) and so on.

Not your average wannabee BTL 'want to buy up and the houses and rent them out' me me me me me.

I say 'will'... because it's for new buyers to pay.

Not like yesterday when someone claimed it was a boon to the Wilsons. Couldn't be more wrong imo.

Potential BTL buyers will have reason to hold back, after it fully kicks in, with higher stamp duty. It's not going to be buy 15+ in one lot and no stamp duty for standard BTLers.

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It is to stop accidental landlords and discourage second home owners., and also discourage small scale BTLrs that present a systemic risk to the banking system, who are likely to react irrationally to market conditions.

But to apparently actively encourage larger portfolio landlords who tend not to flip and to but and manage large portfolios.

I don't know why they should be exempt, I don't understand why my second paragraph is being encouraged.

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I think they want to encourage actual corporations and builders (remembering it is stamp duty land tax). As this exemption is part of the consultation it's not yet set in stone so the details may change. You will probably also get a chance to voice your views to the Government under the consultation, although I'm not sure how much good that really does.

Bland's idea that they may be intentionally herding BTL landlords into corporate structures to then gut them with Basel III may well be correct, and if not I don't think it's such a big deal in any case. While I agree that encouraging large portfolio landlords isn't a good thing, most of the really insanely leveraged ones will not be able to transfer into a corporate structure because their portfolios lack sufficient equity to meet corporate BTL lending criteria, so the exemption will be neither here nor there for them.

Also, many of the problems caused by BTL are currently being caused by BTL landlords with much fewer than 15 properties (such as those who rent out their former homes every time they move house instead of selling them and allowing the market to clear and actual price discovery) because the majority of BTL landlords have fewer than 15 properties.

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It is to stop accidental landlords and discourage second home owners., and also discourage small scale BTLrs that present a systemic risk to the banking system, who are likely to react irrationally to market conditions.

But to apparently actively encourage larger portfolio landlords who tend not to flip and to but and manage large portfolios.

I don't know why they should be exempt, I don't understand why my second paragraph is being encouraged.

Ahhh

Because they can then bring in some laws for big landlords and make them have proper anti-social behaviour policies and all the other (money wasting) gubbins that housing associations faff about it.

Or because they will force them to become HA...?

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