The UK government has lifted restrictions in the country’s real estate sector in an effort to open up activities, media reports said. Reopening of the domestic real estate market is anticipated to boost economic confidence and bring stalled transactions into movement.
David Hannah, Principal Consultant and Founder of Cornerstone Tax, said in a statement, “Tax changes such as this are in some places complex and should be dealt with on a case-by-case basis, as every investor has a slightly different situation. This example, on the face of it, does seem to make buy-to-let less attractive to investors and so reduce the incentive to invest in the market.”
The protracted pandemic has changed the dynamics of the real estate market globally. This year onward, landlords and property investors will no longer be able to deduct home finance costs from their taxable rental income, a statement said.
According to Rightmove data, it has recorded a 22 percent increase in demand for renting compared to the same period last year. “As the government should want to kick-start the housing sector post-covid a 12-month hiatus on the 3 percent surcharge for second properties would help to boost the number of property purchases as investments. Properly managed, this would help bolster the supply in the private rental sector, reducing pressure on councils and bringing rent in line with inflation,” Hannah said.