Lib Dems Celebrate Victory Over Buy To Let Threat (North Bedfordshire Liberal Democrats)

North Bedfordshire Liberal Democrats <bedford@bedfordlibdems.org>

Lib Dems Celebrate Victory Over Buy To Let Threat

December 8, 2005 7:06 PM

'For Sale' and 'Sold' signs. Bedford and Kempston Lib Dems are celebrating a victory for local residents after Gordon Brown performed an astonishing U-turn in the House of Commons on Monday.

Following pressure from Liberal Democrat MPs, Mr Brown admitted defeat and changed the rules relating to Self Invested Pension Plans (SIPPS) which, if left untouched, could have led to further increases in house prices in Bedford and Kempston as wealthy investors purchased buy-to-let homes with pension tax breaks.

In 2004 the Government relaxed the rules on SIPPS which meant that people could purchase a property, put it into a pension product known as a SIPP, and then receive a generous 40 per cent tax break. The rules were meant to start in April 2006, but have now been scrapped in line with Liberal Democrat proposals tabled in June.

Commenting, Michael Headley said: "This is great news for those wishing to climb on to the housing ladder in Bedford and Kempston. We all know that flats and houses in here are an extremely attractive prospect for wealthy investors so I am delighted our campaign has forced the Government's hand.

"Offering rich investors a 40 per cent tax break to buy a rental home here could have priced ordinary people out of the market completely. What we need is good quality, affordable housing that is available to those who live and work in the community.

"I am delighted that concerted Liberal Democrat pressure has shown the Government the error of their ways. Of course this is just the tip of the iceberg when it comes to securing affordable housing, but at least the Chancellor's U turn offers people in urban areas like Bedford and Kempston some protection."