The property industry’s call for a VAT cut on home renovations will receive and enthusiastic reception from residential landlords and buy to let investors. The initiative comes hard on the heels of new evidence that building new houses emits four-and-a-half times as much CO2 as refurbishing an existing dwelling.
A recent report by the Empty Homes Agency (EHA) claimed that embodied carbon - the CO2 emitted as a direct result of constructing a new building - accounts for nearly three times as much of a building’s lifetime emissions as was previously thought.
The British Property Federation (BPF) has backed the EHA’s call for a 17.5 percent rate of VAT on repairs and renovation to existing buildings and for this to be aligned with new build (which is currently exempt). The BPF also supports calls for councils to be incentivised to bring empty homes back into use, through planning and delivery grants.
The research report, New Tricks with Old Bricks – how reusing old buildings can cut carbon emissions, comes amid growing unrest in the housing and mortgage market over lack of credit and with house builders beset by a growing list of green targets.
Liz Peace CBE, BPF chief executive, said: “This report throws a welcome argument into the mix and we fully support moves to bring old homes back into use.
owever, we still need more quality housing, so this should not be seen as argument for opposing the government’s targets over housing supply or green construction standards.
“We hear the phrase ‘sustainable communities’ so much that people seem to ignore its true meaning. We need balance; a mix of old and new, with homes and communities well supported by infrastructure, education, health and business. Many empty homes could play a key role in meeting the government’s need to improve housing provision, and cutting VAT on refurbishment would be an incentive to encourage not just an increase in supply, but an improvement in the eco-friendliness of that supply.”
• Fears that the buy to let sector may be experiencing a downturn have been contradicted by recent reports, including one from The Money Centre, an independent buy to let mortgage brokers.
This February was its busiest ever month and the company achieved £187,000,000, an increase of 47 percent on the same month last year.
Lynsey Sweales, marketing and PR director, said: “With all the negative press surrounding the property market, it is reassuring to see that this is not necessarily justified. Although we are only in the second week of March, early indications show that it could be an even better month. We are also experiencing higher levels of enquiries.”
