LETTING & ESTATE AGENT

March 2011 budget, good news for Landlords?

March 2011 budget, good news for Landlords?

The areas of the Budget we found most interesting and will have a positiveeffect on Landlords Property Businesses are;

 

Forecast of a steady rise in economic growth will translate into growthin rental demand

Economic growth is predicted to be 1.7% for 2011, 2.5% in 2012 and 2.9% in2013.

 

Less tax for Landlords running their property business througha LTD company

 Corporation Tax will reduce by 2% in April and continue to reduce by 1% every year until it reaches 23%.

 

Mortgage borrowing set to ease

 Banks pushed to increase credit lines to small businesses by 15%.

 

Stamp Duty reduced for Landlords purchasing property in bulk

Stamp Duty to be levied on the mean (average) value of properties in a bulk purchase transaction, rather than thetotal transaction value.

 

Other changes in the budget to note;

● Inflation will be 4% to 5% this year dropping to 2.5% next year

● Measures to help small businesses will include the removal of regulations which cost businesses £350m

● £250 million commitment to first-time buyers to help 10,000 families get on housing ladder

● Taxation on high value property is to be increased

● Real Estate Investment Trusts to be simplified to encourage home building

● Council tax freeze

 

Our overall “take” is that this is an encouraging budget for landlords and business owners. The measures proposed tohelp first time buyers are not even a drop in the ocean. Demand will continue to rise for rented accommodationparticularly in areas benefiting from extra investment. Falling inflation, the council tax freeze and help for smallbusinesses including extended rate relief are all to be welcomed. The news about Stamp Duty to be levied on meanvalue of property is the most encouraging for any Property Investors looking to expand their property portfoliothrough bulk purchases.