Whitby - Being Destroyed by 2nd Home Owners

[Cardiffdaffs]

Buy to lets of course is not a new phenomenon and neither is the slow trickle of locals away from towns with a desirable housing target. The London effect is now hitting the north because of a number of factors. Low interest rates, shortage of housing and of course post Covid the wish to change lifestyles.

I work occasionally as a consultant for a firm in the city and they have most employees working from home because, well, they can very effectively do what they need to do without jumping on a train. Instead of living in commutable properties to London they now want to go to more pleasant environments - mostly that means by the sea All they need is strong wifi.

So apart from the growing investment in second properties to let you have the purchase of bolt holes by the sea and they just as bad because they remain empty for periods in the year. Classic example of this is Lyme Regis in Dorset. Only the wealthy can own and live there now.

 

[JaenBoro]

Its not just the costs of housing. Everything is expensive in Whitby now - food, drink, etc. I am Whitby born and bred but now living abroad and this has been coming for years, it hasn't happened suddenly. When I was a kid - 40 odd years ago - there were only 8 year round residents in Runswick Bay (the part down the bank) for example. Its just getting worse and worse and nobody does anything because the people with power have vested interests in the tourism sector.

I was back there during Easter week and I am a bit pessimistic about the long term for Whitby. I am getting the feeling its starting a slow descent downmarket. I see there is now an Irish pub FFS, there were a few hen party types around town and drunken fights were in the news. It doesn't want to be turning into a mini Blackpool or even Scarborough.

 

[Redwurzel]

Inheritance Tax is too generous in my opinion. I read its possible to leave £1m and not pay any inheritance tax. Most people don't earn £1m in take home pay over ther life time never mind leave it when they die. I would set the max allowance at £500k with 20% tax to pay on anything above. Inherited wealth is the bedrock of inequality to me. Not sure what the moral argument is for family trusts neither, where all inhertance tax is avoided. They seem a tax avoidance vehicle to me that the wealthy have and the poor don't have.

 

[Same_as_before]

So you're struggling for cost of heating but advocating taxing the life off those getting a share of an inheritance that might lift them off the poverty line, from a property paid for with taxed wages?

I can't imagine not thinking about money in my 60's, I imagine the youth of today will be in a worse situation. Alright for those with nice fat final salary pensions I imagine, but if inheriting their parents life work helps someone retire a few years earlier rather than work to 68 I'm all for it.

Build affordable homes instead of taxing people for daring to do well. These aren't millionaires we are talking about here.

No where did I say I was struggling to pay for heating, I said the increase was noticeable. As for daring to do well, are you saying people who pay rent for a small flat in London are not? It's simple tax inheritance at 60%, the people who get the benefit are old and hardly need it, until care home costs.

I will never understand why massive funds should just be passed on, it is not earned it is based on inflation. Tax it.

 

[Nano]

So you're struggling for cost of heating but advocating taxing the life off those getting a share of an inheritance that might lift them off the poverty line, from a property paid for with taxed wages?

I can't imagine not thinking about money in my 60's, I imagine the youth of today will be in a worse situation. Alright for those with nice fat final salary pensions I imagine, but if inheriting their parents life work helps someone retire a few years earlier rather than work to 68 I'm all for it.

Build affordable homes instead of taxing people for daring to do well. These aren't millionaires we are talking about here.

This is exactly the sort of response I expected and it is because you are failing to see the bigger picture. If one 60 year old needs an inheritance and doesn't get it because just they are taxed then it is bad, nut it is different if it is society as a whole. In reality the situation is that because nobody's inheritance is heavily taxed then the person in their 60s is relatively much worse off than if everyone was taxed more. Low inheritance tax, or no inheritance tax if you are rich enough to know how to avoid it, means wealth is concentrated upwards. High inheritance tax means people start life on a more even footing so end life on a more even footing. Nobody should go in to their 60s needing an inheritance to survive. If they do then you must recognise that many 60 year olds won't be due an inheritance so they will not be able to afford to be 60+ without working until they die. You are missing the point that if everyone was taxed much more then you would benefit far more from the people that have a lot paying a lot of tax than you lose by you missing out on a small inheritance.

Compare it to income tax (smiplified). Sure, being taxed 20% of your income seems like a lot but if you earn £20k it costs you £4k for access to all the public services. Someone earning £1bn also paying 20% will put £200m into the system to pay for public services. Scrap income tax and you save £4k but you are getting a terrible deal because now you have no public services because nobody is putting their £200m in. They can pay for their healthcare, kids education, security etc with their wealth. Could you afford all that with the £4k you saved?

Inheritance tax is exactly the same. You don't benefit as much as you think you do by being able to inherit a small amount of money (relatively) tax free.

Inheritance Tax is too generous in my opinion. I read its possible to leave £1m and not pay any inheritance tax. Most people don't earn £1m in take home pay over ther life time never mind leave it when they die. I would set the max allowance at £500k with 20% tax to pay on anything above. Inherited wealth is the bedrock of inequality to me. Not sure what the moral argument is for family trusts neither, where all inhertance tax is avoided. They seem a tax avoidance vehicle to me that the wealthy have and the poor don't have.

As a starter it should be treated like income tax. If 100 people die and leave me their inheritance then I could pay £0 in tax if they are all under the threshold. Makes more sense to make it a lifetime thing and tax it like income.

 

[Redwurzel]

JB - I lived in Whitby as a teenager and then returned on anf off for the next 20 years. It changed a lot in that time, from a summer holiday type place to an all the year round destination. The numbers of visitors seem to treble particularly in the centre of Whitby and the number of holiday lets/homes when through the roof. People used to come and stay at a B/B, hotel, caravan in the 1970s, then it went holiday homes/lets in the 1980s onwards. In the summer it could get tacky in places, but there were the visitors (professional type) who came to walk, appreciate the views, sail etc, they seem to be out numbered by people who want to shop and have some fish and chips nowadays but the middle class types are there too (more likely in Runswick, RHB, Sandsend). There was always differing groups its the numbers that have so increased of all types, but Whitby's capacity has not grown to match. I used to look forward to visiting the centre of Whitby, it doesn't now because there are just too many people most of the time. It feels more crowded than London to me. If someone wants to be on the beach, in the sea, have some fish and chips and be able to park the car close by, and just relax, Saltburn is much better.

 

[Redwurzel]

Nano - remember some wealth has been gained through people's work etc where it has already been taxed once, possibly twice (Income Tax, National Insurance). For taxes to work they have to be accepted as fair and bearable by the majority. Therefore some balance and compromise is required in my opinion. We could tax all income but we don't as people get income tax allowances and NI thresholds (lower). My argument is the balance is not right at present (if its above £500k). Setting the rate at 20% is a compromise I feel it should be higher for higher wealth, but there are people that leave the UK once they have made their money here and say setting a rate of say 40% would encourage them to leave or find even more tax avoidance schemes. If I was Chancellor I would look at the data before setting the exact rate. I want a rate that looks to maximise tax revenue from the super wealthy.

 

[Centralscrutinizer]

JB - I lived in Whitby as a teenager and then returned on anf off for the next 20 years. It changed a lot in that time, from a summer holiday type place to an all the year round destination. The numbers of visitors seem to treble particularly in the centre of Whitby and the number of holiday lets/homes when through the roof. People used to come and stay at a B/B, hotel, caravan in the 1970s, then it went holiday homes/lets in the 1980s onwards. In the summer it could get tacky in places, but there were the visitors (professional type) who came to walk, appreciate the views, sail etc, they seem to be out numbered by people who want to shop and have some fish and chips nowadays but the middle class types are there too (more likely in Runswick, RHB, Sandsend). There was always differing groups its the numbers that have so increased of all types, but Whitby's capacity has not grown to match. I used to look forward to visiting the centre of Whitby, it doesn't now because there are just too many people most of the time. It feels more crowded than London to me. If someone wants to be on the beach, in the sea, have some fish and chips and be able to park the car close by, and just relax, Saltburn is much better.

Don't be telling people to come to Saltburn

 

[JM14]

Exactly. You will get I worked hard to own my home, no they worked hard to pay for a small part of its value, then I want to leave it to my kids, who will be in their 60's, and people who pay rent work hard too.

Can’t see why anyone would want to work their entire life paying a mortgage for the state to take back their home once they die, not a chance is that fair

Making inheritance more difficult won’t solve these issues, property in good areas will always be taken by the ultra rich for investments or second homes. Stopping someone passing a 300k property onto their children/grandchildren won’t change this, it will just make it harder for future generations

 

[Same_as_before]

Can’t see why anyone would want to work their entire life paying a mortgage for the state to take back their home once they die, not a chance is that fair

Making inheritance more difficult won’t solve these issues, property in good areas will always be taken by the ultra rich for investments or second homes

Why should someone's child be better off because you pay a mortgage rather than rent?

 

[ThatFragranceGuy]

No where did I say I was struggling to pay for heating, I said the increase was noticeable. As for daring to do well, are you saying people who pay rent for a small flat in London are not? It's simple tax inheritance at 60%, the people who get the benefit are old and hardly need it, until care home costs.

I will never understand why massive funds should just be passed on, it is not earned it is based on inflation. Tax it.

People who live in a small flat in London are choosing to live in the capital. How out of touch with reality are you to say that people aged 60+ "hardly need" it? Unless they live in Nunthorpe or wynyard or something, majority of teessiders in that age bracket would find that sort of inheritance life changing, and that is now with people of that age still coming from bettter pensions and early retirement age.

By the time the youth of today retire it will be aged 70 and not a final salary pension in sight.

I'll tell you why "massive" funds should be passed on- they worked for that money and took the risk of property ownership, the Money they earned was taxed as they earned it, the money they spent on property maintenance, extensions etc was taxed on VAT, and where there have been downturns, they've lived through negative equity.

Are you going to start indemnifying losses if people go into negative equity? Or if subsidence is found?

I wouldn't mind a scheme like you mentioned as long as the government stump up an equal share of the capital that they later take as tax when it's sold. Otherwise it's none of the risk and all benefits to the government, only to be spaffed away.

 

[Nano]

Nano - remember some wealth has been gained through people's work etc where it has already been taxed once, possibly twice (Income Tax, National Insurance). For taxes to work they have to be accepted as fair and bearable by the majority. Therefore some balance and compromise is required in my opinion. We could tax all income but we don't as people get income tax allowances and NI thresholds (lower). My argument is the balance is not right at present (if its above £500k). Setting the rate at 20% is a compromise I feel it should be higher for higher wealth, but there are people that leave the UK once they have made their money here and say setting a rate of say 40% would encourage them to leave or find even more tax avoidance schemes. If I was Chancellor I would look at the data before setting the exact rate. I want a rate that looks to maximise tax revenue from the super wealthy.

Double taxation by taxing inheritance is a myth. When we spend money we pay VAT, we pay fuel duty, we pay council tax etc. That is "double tax". The confusion is that people think that the person that dies pays the tax on money they have already paid tax on. They don't, the tax is paid by the person that inherits. It is the first time they have received that money so why shouldn't they be taxed? It is confused further because the tax is calculated based on the estate so I can see why people might equate it to the person that died paying the tax.

You don't have to do anything to inherit money. Why should someone be able to just inherit a load of cash without paying tax? You get taxed for working when you are doing something productive. It's odd not to tax you on something that is unproductive. But again, look at the bigger picture; people inheriting £100k is not comparable to people inheriting millions or billions but the tax system has to be set up in a way that is fair for everyone and letting people off because it's only a small amount means you have to allow the super rich to keep their money as well and that is a much bigger problem.

 

[Same_as_before]

People who live in a small flat in London are choosing to live in the capital. How out of touch with reality are you to say that people aged 60+ "hardly need" it? Unless they live in Nunthorpe or wynyard or something, majority of teessiders in that age bracket would find that sort of inheritance life changing, and that is now with people of that age still coming from bettter pensions and early retirement age.

By the time the youth of today retire it will be aged 70 and not a final salary pension in sight.

I'll tell you why "massive" funds should be passed on- they worked for that money and took the risk of property ownership, the Money they earned was taxed as they earned it, the money they spent on property maintenance, extensions etc was taxed on VAT, and where there have been downturns, they've lived through negative equity.

Are you going to start indemnifying losses if people go into negative equity? Or if subsidence is found?

I wouldn't mind a scheme like you mentioned as long as the government stump up an equal share of the capital that they later take as tax when it's sold. Otherwise it's none of the risk and all benefits to the government, only to be spaffed away.

No it's a tax on inflation, unearned income. As I am over 60 I must have a clue. I will be leaving my 60 yo kids a small fortune, they won't need it. I doubt that is unusual. At best the tax should be 50% over £250,000. What 60 yo needs that sort of lumper?!

 

[ThatFragranceGuy]

No it's a tax on inflation, unearned income.

It doesn't matter what it's called, it will never happen.

 

[JM14]

Why should someone's child be better off because you pay a mortgage rather than rent?

Just the way of the world isn’t it? Some people are born into millions, some are born into nothing. Making inheritance difficult for lower to middle earners won’t fix these inequalities, if anything it will widen the gap

 

[Nano]

People who live in a small flat in London are choosing to live in the capital. How out of touch with reality are you to say that people aged 60+ "hardly need" it? Unless they live in Nunthorpe or wynyard or something, majority of teessiders in that age bracket would find that sort of inheritance life changing, and that is now with people of that age still coming from bettter pensions and early retirement age.

By the time the youth of today retire it will be aged 70 and not a final salary pension in sight.

I'll tell you why "massive" funds should be passed on- they worked for that money and took the risk of property ownership, the Money they earned was taxed as they earned it, the money they spent on property maintenance, extensions etc was taxed on VAT, and where there have been downturns, they've lived through negative equity.

Are you going to start indemnifying losses if people go into negative equity? Or if subsidence is found?

I wouldn't mind a scheme like you mentioned as long as the government stump up an equal share of the capital that they later take as tax when it's sold. Otherwise it's none of the risk and all benefits to the government, only to be spaffed away.

Again, you are confusing who is paying the tax. The deceased does not pay a penny so all of those risks etc the deceased has full rewards from until they die. They are free to spend every penny of it if they wish. They can give it away as gifts, they can give it to charity. Once they die a beneficiary (or beneficiaries) inherit. The beneficiary has not taken any risks, they have contributed nothing, they have earned nothing. They are just receiving a sum of money. In general, when we receive money we pay tax. Why should inheritance be different?

 

[ThatFragranceGuy]

Again, you are confusing who is paying the tax. The deceased does not pay a penny so all of those risks etc the deceased has full rewards from until they die. They are free to spend every penny of it if they wish. They can give it away as gifts, they can give it to charity. Once they die a beneficiary (or beneficiaries) inherit. The beneficiary has not taken any risks, they have contributed nothing, they have earned nothing. They are just receiving a sum of money. In general, when we receive money we pay tax. Why should inheritance be different?

I'm not confusing who is paying the tax. I know fine well who is paying the tax.

 

[ThatFragranceGuy]

No it's a tax on inflation, unearned income. As I am over 60 I must have a clue. I will be leaving my 60 yo kids a small fortune, they won't need it. I doubt that is unusual. At best the tax should be 50% over £250,000. What 60 yo needs that sort of lumper?!

The majority of people who are 60+ who aren't on final salary pensions and going to have to make do with meagre state pensions or small company pensions. Averaged out over life expectancy the money can be life changing, and you want to hand down your earnings to the next generation to help lift them up in a similar fashion.

Life expectancy is 81 years old so someone who is 60 and lives to 81, we aren't talking millionaires here so it's literally hurting the people getting small inheritances the most, especially up north. It isn't these people causing problems in Whitby, or owning all the properties in Knightsbridge, is it?

I take solace in the fact these barmy policies are just pipe dreams and even the tories aren't stupid enough to try bring them in.

 

[Same_as_before]

Again, you are confusing who is paying the tax. The deceased does not pay a penny so all of those risks etc the deceased has full rewards from until they die. They are free to spend every penny of it if they wish. They can give it away as gifts, they can give it to charity. Once they die a beneficiary (or beneficiaries) inherit. The beneficiary has not taken any risks, they have contributed nothing, they have earned nothing. They are just receiving a sum of money. In general, when we receive money we pay tax. Why should inheritance be different?

I think that succinctly sums it up. No one breathing is paying the tax.

 

[Nano]

I'm not confusing who is paying the tax. I know fine well who is paying the tax.

Why are you talking about the risks of someone else then? Why should you be able to receive a sum of money without contributing anything towards earning it?

You wouldn't question why you pay income tax when someone else took all the risks to set up a business would you? What's the difference?

The majority of people who are 60+ who aren't on final salary pensions and going to have to make do with meagre state pensions or small company pensions. Averaged out over life expectancy the money can be life changing, and you want to hand down your earnings to the next generation to help lift them up in a similar fashion.

Life expectancy is 81 years old so someone who is 60 and lives to 81, we aren't talking millionaires here so it's literally hurting the people getting small inheritances the most, especially up north.

I take solace in the fact these barmy policies are just pipe dreams and even the tories aren't stupid enough to try bring them in.

If everyone was taxed properly then people in their 60s wouldn't need inheritances to survive. The Tories would never bring these policies in because it benefits the rich the most. You are upside down. Labour won't bring it in either because it would be a vote loser but only because people don't understand why inheritance tax done properly is better for them.

As I've already said anyway, if you want to help the next generation do it while you are alive instead of waiting until you are dead. A 60 year old would have benefited far more from having the cash in their 30s than they will in their 60s.