Landlords have warned the next Prime Minister must address the supply crisis in the private rented sector if home ownership ambitions are to become a reality.

The National Residential Landlords Association (NRLA) issued the warning as new survey data shows that the supply of homes to rent is likely to keep falling over the next year.

According to this research, by BVA-BDRC, 23 per cent of landlords said they plan to cut the number of properties they let in the next 12 months. This is up from 20 per cent a year ago.

In contrast, just 14 per cent say they plan to increase the number of properties they let, unchanged since the same point last year and down four points since the first quarter of this year.

Against this picture of falling supply, 60 per cent of landlords in England and Wales reported increased demand for rental housing in the second quarter of the year. This represents a large increase on the 39 per cent of landlords who reported increased demand a year ago.

With the demand for rental housing outstripping supply, official data has found that private rents across the UK rose by 2.8 per cent in the year to May this year, the largest annual growth since January 2016.

This latest survey supports recent evidence of the fall in supply from other organisations including the District Councils Network. 76 per cent of the councils it surveyed warned that a rise in landlords leaving the sector or converting properties to holiday lets, has led to longer waits for council housing.

Punitive tax

The NRLA is warning that the trend is a direct result of government policy and punitive tax increases since 2015, which have shrunk the private rented sector.

Since the Government began to restrict mortgage interest relief for landlords, the number of private rented homes in England has fallen by over a quarter of a million, it claims.

The next Prime Minister to end this ‘hostility’ to landlords, NRLA said, and take steps to encourage investment to meet the rising demand.

Ben Beadle, its CEO, (main pic) adds: “The last six years prove that it was a nonsense to think that cutting the supply of rental housing when demand is so strong would make it easier for those saving for a home of their own.

“Driving rents up just leaves tenants with less cash to save for a deposit.

“We need a strong and vibrant private rental market that meets the needs of those who rely on the flexibility it provides, those who need somewhere to live before becoming homeowners and those for whom the promise of social housing tomorrow provides cold comfort today.

“The next administration needs to reset its plans for the sector,” he said.