The Treasury has announced plans to examine the stamp duty treatment for investors of Reits and other large-scale property investments following a successful campaign for reform by the British Property Federation (BPF). The BPF has long pressed the government to remove a stamp duty anomaly that means a single investor who buys a number of residential properties must pay stamp duty at a higher rate than investors who buy one residential property each. A targeted relief would remove this disincentive against large scale investment in housing and make it more viable. The government has announced that it will look at the problems facing investing in large-scale developments and how the use of Real Estate Investment Trusts (REITs) could help.

A Reit is a more tax efficient structure enjoyed by big office and retail developers where people buy shares in the Reit as they would do with any other company’s shares rather than buying actual buildings. This would potentially mean that a lot more money could be available to build homes if the right structures are introduced. It is hoped that the changes could open the way for private individuals to invest in a piece of large-scale rented housing developments funded by institutions and listed property firms.