Scotland’s latest tax hike will ‘crucify’ mortgage lending

Malone predicted lenders altering their affordability calculators in Scotland and interest-only borrowers struggling to remortgage.

Scotland’s latest tax hike will ‘crucify’ mortgage lending

The Scottish housing market will be hammered by major hikes in council tax on top of an optional 3% increase coming into force in April – stunting how much can be lent and slowing down transactions.

That was the view of ex-PMS chairman John Malone.

Malone, who lives in Glasgow, has been notified that his council tax will increase by 17.5% in April, not including the 3%, while others are said to be charged 22.5% more than last year.

Malone predicted lenders altering their affordability calculators in Scotland and interest-only borrowers struggling to remortgage.

He said: “The SNP has absolutely hammered the housing market here in Scotland; they do not realise the damage they are doing and haven’t thought this through.

“They will blame Brexit but that’s not the issue; it’s their taxation of the man in the street.

“That is going to crucify the housing market and lending opportunities in Scotland.”

He added: “I’ve already spoken to one major lender that says it will impact their affordability calculator.

“The level of mortgage you can get will be reduced in comparison to England – that will slow the housing market down.

“It will have a significant impact on any lender looking at 90% or 95% loan-to-value.

“And as a property prisoner you’ll be even more of a property prisoner in Scotland.”

Malone reckoned those with homes worth more than £250,000 will be affected.

Meanwhile anyone earning more than £43,000 will be charged a 40% rate of income tax, meaning they will pay more than anyone in England.