Do governments see real estate markets as cash cows?

[nmb]

Since the 2008 US mortgage crisis, which led to a worldwide recession, we have seen many governments struggling to balance their budgets. However, it would seem that the recovery in worldwide real estate markets has caught the attention of governments across the globe.

The introduction of new taxes, new charges and new regulations would seem to suggest that politicians see real estate markets as their cash cows of the future. Are they using buoyant real estate markets to pay for their financial mismanagement?

 

[Michelle Barringer]

In the UK i would suggest that the government are trying to stabilise the market to prevent history repeating itself - but also cash in on the success of this sector to balance out spending elsewhere in the economy - i'm not sure i would phrase it as financial mismanagement myself - but part of their job - lovely as it would be not to be taxed so heavily - any successful sector is always going to attract taxation to support the under performing areas of the economy

 

[Nicholas Wallwork]

So I think you're agreeing there Michelle... Property investors and landlords have always been a massive source of income for the UK government and that's not going to change any time soon... If they can rake in some more tax from our sector and at the same time cool the market a little it's not hard to see why this think this is a good strategy...

 

[PropEx]

Some of the tax breaks the buy to let investors were getting were ridiculous and went on for too long. How can somebody claim 10% in wear and tear but not have bought anything for the property?

 

[Nicholas Wallwork]

Some of the tax breaks the buy to let investors were getting were ridiculous and went on for too long. How can somebody claim 10% in wear and tear but not have bought anything for the property?

I agree that was excessive but that was withdrawn some years ago...

I guess if the house is getting run down the Landlords need to be able to claim for reasonable expenses to keep the standard up. Otherwise they're going backwards as is the standard of accommodation which will hurt the end residents...

 

[nmb]

In my mind there is no doubt that governments have fleeced buy to let investors over recent years with new taxes, this is not the only part of the UK property market which has been treated like a "cash cow". The idea of "taxing the rich" because they can afford it does not really stack up because where is the help and assistance when investors lose money?

 

[PropEx]

I agree that was excessive but that was withdrawn some years ago...

I guess if the house is getting run down the Landlords need to be able to claim for reasonable expenses to keep the standard up. Otherwise they're going backwards as is the standard of accommodation which will hurt the end residents...

I was under the impression that the wear and tear allowance was only being withdrawn this year, April?