For a government that wants to fix the UK’s ‘broken’ housing market, yesterday’s budget was thin on measures to support the private rental sector, and introduced several measures that will reduce landlords’ desire to invest in buy-to-let.
That is the message from many corners of the lettings industry this morning following yesterday’s budget, which closed the ‘lettings relief’ loophole that has enabled landlords to claim increased relief on a property they sell if it has been rented out.
“With the demand for private rented housing rising whilst supply is shrinking, we needed pro-growth taxation measures to ensure that tenants have an adequate supply of housing to choose from,” says David Smith, Policy Director for the Residential Landlords’ Association.
“Despite being given innovative suggestions to protect tenants in their homes, encourage sale to tenants, and improve energy efficiency, we got a damp squib with little more than promises of further consultations. “Eventually the government will need to stop consulting on the housing crisis and take action.”
James Davis (left), CEO online lettings company Upad, says he doesn’t understand why the government is singling out landlords and the private rental sector for punishment.
“It would be nice if [the] government viewed landlords with more respect and recognised that for many, working within the PRS is a business choice which should, therefore, command the same respect as more mainstream business areas,” he says.
“Every year, without fail, UK Plc builds too few new homes. That deficit of new homes grows and grows and the contribution that the private rented sector makes in delivering sufficient quantities of homes is, therefore, vital.”
Neil Cobbold, CEO of Payprop (right), says the budget missed several opportunities including to clamp down on Airbnb more heavily, putting the taxation of landlords on a more equal and fairer footing with other businesses, and the introduction of tax breaks to encourage landlords to offer longer, more secure tenancies to renters.
John Lomas, co-founder Accommodation.co.uk (left), says: “Once again the Budget has been anticlimactic for Generation Rent as the Chancellor has done nothing for the millions suffering from rising rents. Whilst the volume of renters is increasing there is a massive shortage of supply in rental property, resulting in upward pressure on rents.
“It is a shame that the change in mortgage interest tax relief, known as the Section 24 tax, hasn’t been scrapped – as the government has done in Ireland – resulting in landlords continuing to be forced out of the the private rented sector due to tax increases that make their businesses nonviable.