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Estate agents question ability to incentivise ‘silver movers’ with tax cuts

by: Edward Murray
  • 23/01/2017
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Estate agents question ability to incentivise ‘silver movers’ with tax cuts
Estate agents in Scotland have questioned whether scrapping the Land and Buildings Transaction Tax (LBTT) for older property owners downsizing would actually re-energise the country’s property market.

Speaking to The Herald, Jeremy Blackburn, head of UK policy at the Royal Institute of Chartered Surveyors (RICS), said: “There are thousands of people living across Scotland who would be keen to downsize if they were offered the right incentive.”

He added: “Underused larger homes are not conducive to a dynamic housing market, and therefore exploring new ways to enable downsizing could make a sizeable contribution to solving the housing crisis.”

The comments come ahead of the forthcoming publication of the UK Government’s Housing White Paper, which will set out a number of ways for England, Wales and Northern Ireland to try and encourage older property owners to sell up and move into smaller homes.

Max Mills, a director at Rettie & Co, agreed that freeing up properties was an issue in Scotland and he said: “One of the main frustrations for us in Edinburgh, and indeed for our other offices around the country, is trying to get people to sell. There is an element that people are unwilling to sell because they are facing an increased bill on their way into their next property.”

However, he questioned whether suspending the LBTT for older movers would actually encourage more of them to up sticks and sell.

He explained: “For these people one element of the decision to move is around the practicalities of downsizing and the other element is weighing up the financial pros and cons of a move. But a lot of people in this bracket are not necessarily trying to cash in and it is very often a lifestyle decision. And if they have made the decision to move, they are willing to take the hit on the cost of moving because it will make their lives easier.”

He concluded: “I can see the logic in it, but when you actually put it to task, I would question how much such an incentive applies to many older homeowners, and I’m not sure it would free up a big wedge of this market.”

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