Osborne is in charge of housing policy as he plots path to Number Ten

While ARLA and the NAEA are to be commended for speaking out about Chancellor George Osborne’s attacks on housing, they are missing the point.

Housing is now politicised, just like the other planks of social cohesion, education, health and welfare.

Housing policy has nothing to do with what is either effective or particularly tax-efficient.

It is curious that since the advent of more vociferous pressure groups like Generation Rent and with the help of other pressure groups with sometimes dubious, but headline-grabbing, market research, the Chancellor has decided to demonise private landlords, endanger social housing stock and interfere in the second home market.

This is surely Osborne paving a path to premiership, with traditional Labour party supporters in mind.

The first step is to be seen to tax these demonised investors in a vital part of the economy, an engine of social mobility, as if they are an Amazon or Starbucks.

This is achieved by denying private landlords the right to charge legitimate expenses against their tax bill from fair wear and tear to mortgage interest relief at a relevant rate. And then make it less attractive to invest in the first place with a swingeing surcharge on Stamp Duty. That’s good for headlines.

What is going on here? Buy-to-let helped to dig housing out of the crisis of the nineties caused by recession and the fiasco of unsaleable starter homes.

Private investment boosted the private rented sector from a mere 6% of all housing towards today’s 15%. No thanks to any government and hardly a disproportionate amount of tenanted housing.

And it enabled the private rented sector to bridge the gap between social housing and home ownership.

But social housing too is also under attack. There is now a Right to Buy from housing associations that can only diminish rental streams and therefore the funding for more social housing.

So both private and social sector tenants are being driven towards home ownership, even as the Mortgage Market Review makes it harder to borrow.

All of this in the name of vote catching? Shades of NHS and educational reforms over the years.

And tenanted housing is not the only sector to be penalised by the house of cards being constructed for housing. Now second-home owners are in the frame.

Never mind that they are the mainstay of many rural and coastal economies, employing builders, craftsmen and a full variety of help and assistance. They encourage shops, leisure industries and pay substantial council tax.

They also frequently bring their skills to local educational boards and trusts of one sort or another. In short, they are an asset to the communities where they choose to have second homes, and not only economically but socially as well.

Never have second-home owners been more needed and at a time when local authority spending has been slashed.

Housing has not been taken seriously by any government since the early sixties when Macmillan had a Secretary of State for Housing in his cabinet.

But now that housing has returned to the top of the agenda it is not run by a cabinet minister for housing but by the most politically minded Chancellor for a century.

Those, like ARLA and the NAEA, who rightly speak out against current housing policy, must also bear in mind the possible political aims that lie behind it.

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One Comment

  1. johnclay

    There is an element of mass hysteria about this.  Buy-to-let landlords have become a soft target.  There is no logic to this and it is dangerous to mess about with the housing market like this.  If the bank of England join in we could be heading for another house price crash, as buy to let landlord will stop buying properties and others will become nervous and hesitate which will spread throughout the market.

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