Landlords have called on the government to ‘take its blinkers off’ and scrap the 3% stamp duty on buy-to-let properties to incentivise landlords to supply an additional 900,000 homes to the private rented sector over the next ten years.
The National Residential Landlords Association (NRLA) has made the call based on new research by Capital Economics.
Modelling by the consultancy also shows that the additional purchase activity would generate £10 billion in additional tax revenue for the government, making it somewhat of a no-brainer for Rishi Sunak as the nation faces a chronic shortage of homes to rent.
Capital Economics also argues that, as young renters’ need for privately rented homes increases as owner-occupied and social housing fail to keep up with demand, between 100,000 and 230,000 extra homes will be needed every year within the PRS.
This, as many letting agents will know, if unlikely to happen given supply has been dwindling as some landlords exit the market.
Capital Economics suggests that without changes in tax or other policies, the private rented sector stock will decrease further by over 500,000 properties over the next ten years.
“The Government needs to wake up to a crisis of its own making,” says Ben Beadle, Chief Executive of the NRLA (pictured).
“Taxing landlords out of the market serves only to cut supply, increase rents and make homeownership more difficult to afford.
“The evidence clearly shows that the supply of rented housing is declining as demand increases and will continue to do so.
“The Government is taking a blinkered approach to the issue, which is not helped by its reluctance to admit mistakes it has made in the past.”