The decision from retailer John Lewis not to invest in build-to-rent should be seen as a sign that the government should relax taxation rules across the sector.
That is according to Jeremy Leaf, north London estate agent and a former RICS residential chairman, who was writing ahead of today’s Spring Statement.
The John Lewis Partnership pulled out of a £500m deal to build almost 1,000 residential rental homes for rent in Bromley, Reading and West Ealing, citing a “cautious property market”.
Leaf said: “In light of the exit by John Lewis from Build to Rent, the government may want to consider relaxing taxation rules in the sector to support specialist providers and their investors in this vital area.”
Running a build-to-rent block has significant costs involved, especially as stamp duty Multiple Dwellings Relief was abolished in June 2024.
Leaf broadly encouraged the government to think about first-time buyers in its policy making, which he dubbed “the engine room of the housing market.
He added: “Better use of existing resources e.g. refurbishment, conversion of un- and under-used land and buildings, including empties, is also essential.
“Little demand means reduced or no supply but building homes is not currently financially viable in many areas.
“Governments do not often appreciate the time and money disconnect so many schemes are delayed or not built at all if, for instance, funding is lost.”