Landlords to exit when renters bill becomes law, agents warn
Timothy Douglas of Propertymark says many landlords will either sell up or switch to short-term lets with higher rents when the Renters' Rights Bill is implemented.
Many landlords are set to exit the PRS or switch to short-term lets when the Renters’ Rights Bill becomes law, Propertymark warns.
Timothy Douglas, Head of Policy and Campaigns at Propertymark (main picture), says the bill could make the current crisis in the PRS with a shortage of rentals and rocketing rents, much worse.
The government must fully understand the impact these changes will have.”
“While we want to see improved standards, the government must fully understand the impact these changes will have,” he said in a letter to the Financial Times.
“Our monthly Housing Insight Report shows on average eight registrations for each available property with fewer new properties coming on to the market.
Exacerbate
“The bill in its current form is highly likely to exacerbate this situation with more landlords withdrawing homes from the private rented sector, frequently moving them to short-term lets.”
Douglas is echoing the views of leading letting agent Marc von Grundherr, Director at Benham and Reeves, who warned that the bill would bring “doomsday” to the private rental market and be bad for renters, landlords and agents.
Von Grundherr said the bill will lead to less landlords and rental homes, as well as higher rents.
Douglas also warns the current taxes paid by landlords are acting as a big disincentive.
“Tax is reducing the investment appetite of new and existing landlords with higher rates of stamp duty on buy-to-let properties and the withdrawal of tax relief on mortgage interest costs,” he says.
Attracted
Landlords are likely to be attracted to the higher rents in the short-term lets market, he says.
“Additionally, with no security of a rental term for a landlord beyond the proposed two months’ notice period and no long-term guarantee of rent, we would expect to see a significant number of landlords attracted to higher rents in the short-term letting market”.