How many properties were purchased between 2012 and 2014 for the purpose of rental?
I will also be giving it serious consideration to selling up this property when the time in 2019, but, will also look into investing into another one, having made a capital tax gain on this one.
No, the exemption ran from Dec 7th 2011 to Dec 31st 2014.Would December 2014 be after the deadline ?
No, the exemption ran from Dec 7th 2011 to Dec 31st 2014.
Yes there should be some additional liquidity in the market at that time but that should just balance out the lack of liquidity now as a result of people precluded from selling as a result of the tax break.
And the people I meet generally intend to hang on to their properties and simply view the 7 year holiday as having a dilutitive effect on the tax position over a longer time frame rather than a 7 year "product" to exit
e.g. tracker rates, lack of supply, high rents, reversal of 75% rule, CGT shelter if you bought high, predictability of the 4%, etc.
After 7 years there is little doubt that there will be an increase in supply of properties on the market.
If all these investors after 7 years sell to other investors there will be zero impact on rental property supply.
However if just 1 of these investors sells to a first time buyer, then this will negatively impact the supply of rental properties. I think I read in the indo recently that only 5% of properties sold currently are being bought to let. If this remains true in 2019 and 95% of these buy to let's are sold to first time buyers then it may have a significant impact on rental supply.
I've posted on the 'pin about this.
If anything, the exemption should be pulled forward, not extended. Allow 2012/2013 purchasers to sell now with the relief, 2014 purchasers next year.
The purpose of this relief was to encourage transactions and it worked. It is now having the reverse effect. Investors are sitting on pretty large paper profits and not able to sell if desired. Supply is restricted at a critical time of reduced supply.
2019/2020 will see the reality of Brexit and the possibility of a huge amount of land developed (if Coveney's plans & announcements are realised) and the 7yr CGT sellers.
I believe the result would be net positive. Increase of stock available should pair demand per unit and, hopefully, reduce current frenzied price action.
If the property is sold onto another BTL individual, that would be neutral to Rental supply.
If sold onto trade up/down, purchaser may add their stock to Rental supply or sell. This stock either goes to rental market or takes someone out of the rental market.
Overall, it's neutral as the stock goes back to market or takes someone out of rental market.
The purpose was to increase transactions. Reverse effect happening now and adds to current price mania.
Edit: on who will purchase. Plenty of renter's are able to purchase at certain levels but fail in the bidding process.
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