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Budget ‘failed to tackle shortage of rented homes’

Landlord organisations say the Chancellor did nothing to boost the supply of rental properties and warn tax hikes are crippling the sector.

Richard Reed

Key to new property image

The Budget has failed to do anything to address the shortage of privately rented homes, say landlord organisations.

They claim that recent tax hikes, including stamp duty changes on buy-to-let and the loss of tax-free allowances, are driving away landlords and crippling the sector.

And they warn rents are set to rise as the demand for rented homes outstrips supply.

The Residential Landlords Association and the National Landlords Association warn this only makes it harder for tenants to save for a home of their own.

‘Scrap stamp duty’

They had called for the Chancellor to scrap stamp duty on the purchase of additional homes where landlords invest in property such as new-build, or bring long-term empty homes back into use.

The criticism by the RLA and NLA follows earlier warnings by professor David Miles, a former member of the Bank of England’s Monetary Policy Committee, who commented that “aspiring first-time buyers are hardly helped by squeezing the supply of rental property and driving rents up”.

A survey of 2,000 landlords by the RLA in December showed that 34% were planning to reduce their investment in the market, nearly a third up on the previous year.

In a joint response to the Budget, the RLA and NLA said: “The government is undermining its own efforts to boost homeownership through its attacks on the private rented sector. By choking-off supply and making renting more expensive it is tenants who are hardest hit.

“Ministers need to wake up to the reality of the damage their tax measures are doing to the private rented sector and support landlords to provide the new homes for private rent we desperately need.”

March 16, 2020

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