Jameson and Partners estate agents in Altrincham look at the key takeaways from the Spring Budget 2024

Key Takeaways from the Spring Budget 2024


Key Takeaways from the Spring Budget 2024

Focusing specifically on property matters, we take a look at the key takeaways from the Spring Budget 2024. Delivered by Chancellor Jeremy Hunt on the 6th of March, it’s been met with disappointment by those in the property industry. It’s felt there have been missed opportunities to properly stimulate the market, to free up housing supply, and do more to help first-time buyers with mortgages.

Here are the key takeaways, which are mostly of importance to landlords and lettings agents. Plus we share opinion what could have been done to ease some of the difficulties in the housing market at present.

Property Capital Gains Tax Reduction for Landlords  

A positive for landlords is the reduction on the higher rate of property capital gains tax. It’s being reduced from 28% down to 24%. The property capital gains tax is payable on the sale of non-permanent residences such as second homes, buy-to-let properties, and holiday lets. By reducing the tax, the Chancellor hopes more landlords, especially those who were previously ensure about doing so, will decide to sell their property. By encouraging landlords to sell up, not only will there be more tax revenue, but housing supply will increase.

For basic rate tax payers, the property capital gains tax will remain the same at 18%.

Tax Relief scrapped on Holiday Home Lets

This is a more pertinent issue for areas of the country where holiday homes and lets are prevalent. And specifically in such areas where there are issues around affordability and availability of homes for locals.

In his Spring budget, the Chancellor confirmed that the current tax advantages on furnished holiday lets will be scrapped in April 2025. Furnished holiday lets became a lucrative way for property owners to make a profitable earning. Especially after the clampdown on buy-to-let properties. The Furnished Holiday Lettings (FHL) regime allows landlords to claim full mortgage interest relief and benefit from lower capital gains tax.

This is another move by the Chancellor to encourage more properties onto the market. With this and the reduced capital gains tax rate, there is hope more landlords will make the decision to sell.

Multiple Dwellings Relief (MDR) scrapped

This change affects landlords with larger portfolios the most. It was announced in the Spring budget that the Multiple Dwellings Relief (MDR) will be scrapped from 1st June 2024. MDR was introduced in 2011 with the aim of increasing housing rental stock. It gives anyone buying multiple residential properties, relief on Stamp Duty Land Tax. However, an external review of the efficacy of this tax relief was done. And no evidence could be found of its positive support of investment in the private rental sector. If anything at all, it was found to be open and subject to a lot of abuse.

Missed opportunities in the Spring budget

Yes, the Chancellor confirmed this government is ‘on track’ to deliver 1million homes in this parliament. But it’s felt by property industry professionals that there are missed opportunities with this budget.

It was hoped that, not just at the first-time buyer end, but also at the top of the housing ladder, that there’d be more incentives to get people moving. Industry professionals have since spoken out about helping ‘downsizers’ for example. It’s known that for every sale at the top of the chain, another two to three sales can be facilitated further down the ladder. From more new-build homes to suit downsizers, to tax relief incentives, more needs to be done to help the older generation feel comfortable and confident moving from a large, older family home to something smaller and suitable for their needs.

No mention of Stamp Duty Land Tax

Another disappointment with the budget, for now, was the lack of mention of Stamp Duty Land Tax (SDLT). The current SDLT relief will come to an end at the end of March 2025. Currently, buyers only pay SDLT on a property costing more than £250k. When the SDLT relief ends, this threshold will drop back down to £125k. And for first-time buyers, the relief will drop back down to £300k from the current £400k. This will only add to the woes of the younger generations. They already find it impossible to get on the housing ladder.

Are you a Landlord with property in Altrincham or the surrounding area, and feel unsure whether to sell or to continue renting? Or maybe you are considering becoming a Landlord and hope to find the right buy-to-let property?

Whether you’re selling or renting, we can advise with our expert knowledge of Altrincham and the property in the area. Call us on 0161 941 4445 or send us a message with your situation, here.