UNEMPLOYMENT
The British Property Federation has
appealed to chancellor Alistair Darling
ahead of the Budget this week to
change the way Stamp Duty is levied
when properties are bought in bulk.
Currently, bulk purchases are
charged on the total price at 4%, the
highest tax rate applicable. But individual
properties are taxed at marginal
rates which range from 0% to
NEWS
Unemployment among
tenants goes up by 5%
● ROBERT THICKETT
Smartlandlord.co.uk says unemployment
among new tenants has
shot up by almost 5% in the past 12
months.
The property services website
analysed data received by landlords
from references and checks made
when taking on new tenants.
The results show that unemployment
among new tenants in the private
rental sector has risen from
3.1% in April 2008 to 7.8% this month.
Data from the Office of National
Statistics shows that more than 40%
of the UK’s two million unemployed
are under 25 years old, the age when
consumers are more likely to rent
than own property.
LENDERS
Regionally, areas outside the
South-East and South-West have
been hardest hit, with 16.8% of new
tenants unemployed in Northern Ireland,
9.7% in the West Midlands and
9.1% in Scotland.
The only exception is the unemployment
figure for new tenants in
London, which is the fourth worst in
the country at 8.5%.
Keshav Thukaram managing di -
rector of Smartlandlord.co.uk, says:
“With the occupations of tenants
diversifying from traditional jobs
landlords must ensure they get references
from tenants to ascertain
they can afford the property and ask
for guarantors where necessary.”
Woolwich pulls some long-term deals
● NATALIE MARTIN, ONLINE EDITOR
Woolwich reduced a number of its
tracker rates last week but offset this
by pulling or hiking rates on some
longer term fixed deals.
The lender has withdrawn its 85%
LTV five-year fixed rate and in -
creased the rate on its 70% LTV fiveyear
fixed deal to 4.99% from 4.79%.
It made cuts of up to 0.3% on its
trackers, two-year fixes and offset
deals, but says the cost of funding
meant it had to chop some longer
term deals.
Dale Jannels, sales and marketing
director at All Types of Mortgages,
says more clients are looking for
long-term fixed rates to ensure financial
stability, so he is surprised to see
Woolwich hike its rates.
STAMP DUTY
He says: “It’s something of a surprise
that an influential lender such
as Woolwich has increased its threeyear
fixed rates by 0.4% to 4.29% at
60% LTV and its five-year fixed rates
by up to 0.3% at 60% LTV and 0.2%
to 70% LTV.”
But a spokesman for Woolwich
counters that the changes are necessary
to remain competitive.
Andy Gray, head of mortgages at
Barclays, says: “We have made
changes to our short-term fixed rates
and trackers despite the cost of funding
fixed rates rising.”
He adds that offset mortgages are
growing in popularity as savers with
mortgages take advantage of better
returns in a low interest rate world.
Call to change tax on bulk purchases
4%. The trade body says this is a disincentive
to investment.
In a letter to Darling, Liz Peace,
chief executive of the BPF, states:
“We would like to see bulk purchases
of residential property taxed at the
marginal rate applied to each unit,
levelling the playing field between
in dividual purchasers and those
making larger scale investments.”
MORTGAGE STRATEGY April 20, 2009 9
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