Treasury plans REITs for 2006
March 17, 2005
Alongside the budget, the UK Treasury has announced that it is planning to introduce legislation over the coming year to allow REITs from 2006.
Real Estate Investment Trusts (REITs) are a method of investment fund management using property, that has been popular in the USA, and are usually subject to tax-breaks.
The treasury posted more information on its site in UK Real Estate Investment Trusts: a discussion paper in which is also states:
Subject to finding a workable solution that meets the stated objectives, including reform at no overall cost to the Exchequer, the Government aims to legislate for a UK-REIT in Finance Bill 2006.
Property has already been a well-used form of investment in the UK, and the past few years housing boom and economic growth have been squarely pinned on aggressive property investment, which has freed up consumer equity for spending in the economy.
Coupled with an increased bar on stamp duty to £120,000, the combination of measures could find themselves presenting a bulwark against future value losses what is expected to an already declining property market.