‘The Budget was the nail in the coffin for landlords like me’

Fed-up buy-to-let owners hit back at Rachel Reeves’s ‘imminent’ stamp duty hike

After years of soaring costs and high taxation, landlords have been exiting the market in their droves. 
Almost 47pc have already sold their properties or plan to do so imminently, research from Goodlord and Vouch revealed. 
But in her maiden Budget, Rachel Reeves discouraged landlords even further by hiking stamp duty on second homes and buy-to-lets from 3pc to 5pc straight away. 
As a result, the stamp duty bill for a landlord buying a £250,000 property will soar by 67pc, from £7,500 to £12,500.
Landlords such as Mandy Paterson, from Trowbridge in Wiltshire, have slammed the move, saying: “The Budget was the final nail in the coffin, it will stunt any aspiration for growth.” 
The 57-year-old has eight properties across Wiltshire and says that landlords’ ambition to expand their portfolio has been stamped out by Ms Reeves. 
She says: “The rise in stamp duty is a major blow to second home owners and will deter landlords. If Labour wants to discourage second homeownership, then they have achieved that. 
“Fewer and fewer landlords have the appetite to keep going and this will disincentive those that do.”
Telegraph Money has repeatedly called on the Government to end the war on landlords, and our campaign was bolstered by the news that the Chancellor would not hike capital gains tax on the sale of second homes.
The Treasury says the change to stamp duty will raise £310m by 2030 to plug the £22bn “black hole” that Ms Reeves maintains she inherited. The Office for Budget Responsibility has cast doubt on this figure, claiming the Government was handed £9.5bn of hidden costs from their predecessors. 
But Mrs Paterson believes increasing stamp duty will be worse for landlords than a capital gains rise. 
She says: “Out of the two, I think the rise in stamp duty is more of a heavy hammer to people buying second homes. I’d thought about expanding and would like to, as there is something so positive about providing nice homes for nice families, but now I won’t.”
Lee Williams, of mortgage broker Saffron for Intermediaries, says: “For landlords with smaller portfolios, buy-to-let is starting to feel less worthwhile. 
“In a housing ecosystem already strained with rental availability (currently a fifth lower than the pre-pandemic level), this stamp duty increase could squeeze out non-professional landlords, reducing the supply of rental homes and in turn, driving up average rents.” 
Andrew McGarrick, a landlord in Leicester, says the tax raid will “severely dent investment” and stall the market. 
He has 24 properties and, like countless other landlords, originally invested as a way to save for his retirement. 
He says: “If you don’t have the luxury of a public sector pension, then a brick and mortar pension was a great option. Why should you now be vilified and taxed to the hills?”
Mr McGarrick, 68, says the stamp duty hike will have a “perverse knock-on effect,” resulting in fewer landlords in the market.
He adds: “The Government could reverse the housing crisis by incentivising landlords.”
The Chancellor claims the policy will make 130,000 properties available for first-time buyers and home movers over the next five years. 
However, the industry has condemned the move, saying it ultimately will lead to higher rents for tenants.
Ben Beadle, of the National Residential Landlords Association, says: “Hiking stamp duty on homes to rent when 21 people are chasing every rental property makes no sense.
“Analysis by Capital Economics has found that increasing stamp duty on rental properties from 3pc to 5pc will see a net loss of half a million homes to rent over 10 years. This will not help the huge number of tenants for whom homeownership is still a distant dream.”
Gavin Hutton, 57 from Thornbury, reiterates this point. He has four properties in Bath and Bristol and regularly lets to students. 
He says: “We have a crisis on our hands. The big corporate landlords charge nearly double the amount of rent that small landlords do so it will make things worse for tenants.”
“The Government introduced this stamp duty rise with no notice. It is a deterrent to buy as it is a significant chunk of money. We are already short of landlords, more are selling up than are buying,” he adds. 
Mr Hutton had considered buying more property at some point but says: “I’m not jumping back into the market right now. The rise in stamp duty will delay this even further because I’d have to work to get the required funds.” 
Jan Ward, from Southampton, adds: “Being a landlord doesn’t seem to be a very good investment anymore.”
She invested in three properties 15 years ago to provide for retirement, but still works full-time as a non-executive director at the age of 67. 
She says: “I’m approaching 70 but I don’t know when I will be able to retire because we’re incurring such high costs.”
After Labour’s Budget, she “can see the market shrinking as it’s not a viable option for landlords anymore.”