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Budget: chancellor urged to curb second home ownership

Budget: chancellor urged to curb second home ownership

Owning a second home could become less attractive under plans being looked at to move wealth out of property and into other parts of the economy.

The chancellor, Philip Hammond (pictured) is looking into ways to curb second home ownership in a bid to take heat out of the housing market, according to reports over the weekend.

Hammond is due to publish the results of the Treasury's patient capital review, which was launched to help finance innovative businesses and projects.

It is believed Hammond wants to see the wealth currently tied up in housing, and helping to push up house prices, used to invest in different parts of the economy instead, as he tries to put together a set of housing policies for his Autumn Budget later this month (22 November).

According to The Times, several government departments are at pains to include housing measures in the Budget. It said No. 10 wanted to help people who are renting, the Treasury wanted support for homeowners and the Department for Communities and Local Government wanted measures to encourage building.

Conservative MP Neil O’Brien told the paper: ‘We should leave existing landlords alone. But to restore Mrs Thatcher’s dream of a property-owning democracy we should limit new buy-to-let lending and give tax breaks to young families so they can get their first home.’

Rate rise backlash

The chancellor has also come under pressure from bodies representing thousands of firms to drop a planned 4% business rate rise next year.

A number of lobbying groups including the British Chambers of Commerce (BCC), the Federation of Small Businesses and the British Property Federation, have jointly called on the chancellor to hold off from the rate rise, the The Observer has reported.

The groups have warned the chancellor the rate rise could dent confidence in the months running up to Britain’s exit from the EU (due to take place in March 2019) while other costs, such as pension auto-enrolment, were already mounting up.

Rates are due to rise by 3.9% in line with the retail price index from April next year.

Adam Marshall, director general of the BCC, told The Observer many companies were at a ‘tipping point’.

He said: ‘They face mounting pressures from a combination of costs and taxes including rates, pensions auto-enrolment, the apprenticeship levy, insurance premium tax and the immigration skills charge, just to mention a few.’

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