NRLA calls for government tax review of landlords to tackle private rental market ‘supply crisis’ – Mortgage Finance Gazette
Demand for private rented housing had increased across England and Wales said 65% of buy-to-let owners across England and Wales in the fourth quarter of 2022, according to a poll for the body.
This is up from 56% of landlords who reported an increase in demand in the same period a year ago.
But despite this rise, 30% of BTL owners say they plan to cut the number of properties they rent this year.
The body says: “This is the highest level of planned disinvestment seen in more than six years.”
Just 9% of landlords say they plan to increase the number of properties they rent out over the next 12 months, down from 14% the year before.
The association adds: “The crisis facing renters in need of accommodation follows tax changes aimed at dampening investment in the sector.
“This has included restricting mortgage interest relief, a 3% stamp duty levy on the purchase of homes to rent out and, in the Autumn Statement last year, an effective hike in capital gains tax.”
The body called for “a full review of taxes which impact the sector” as part of its submission to the Treasury ahead the Chancellor Jeremy Hunt’s 15 March Budget.
It wants the Treasury to analyse the combined impact of all recent tax changes on the supply of homes for rent.
National Residential Landlords Association chief executive Ben Beadle says: “From students queuing to view properties, through to benefit claimants who struggle to access homes they can afford, the impact of the supply crisis in the rental market is stark.
“The harsh truth is that the government’s efforts to discourage investment in the sector are working.
“But punitive taxation alongside record demand for rented housing is a disastrous combination that serves only to hurt renters.
“The supply crisis we see is entirely government made and the policies of successive Chancellors have backfired spectacularly – it is time to change tack.
“The Treasury needs to undertake a comprehensive review of the taxation of the rental market.
“This needs to assess the impact recent tax hikes, including changes to mortgage interest relief and stamp duty, are having on supply.
“We then need pro-growth measures to support renters to access the homes they need.”
The National Residential Landlords’ Association poll was carried out by data group BVA-BDRC, which conducted 752 interviews with members of the body in England and Wales online between 25 November and 30 December 2022.