Plea to reconsider landlord tax as young people face 'perfect storm' of housing
The Residential Landlords Association (RLA) has asked the Government to reconsider the way landlords are taxed after a new report claimed 16 per cent of young people will never own their own home.
The report by the Resolution Foundation says more needs to be done to improve security in the sector and calls for the introduction of indeterminate tenancies and ‘light-touch rent stabilisation’.
It also advises tripling the capital gains tax allowance for those selling to a first time buyer to encourage landlords to sell-off properties.
RLA policy director David Smith said the Government needs to focus on pro-growth taxation policies to help landlords provide the extra homes to let that are needed.
He said: “Today’s report shows the perfect storm that young people face.
“With home ownership remaining difficult for many to access, demand for homes to rent continues to increase.
“This is at a time when Government tax increases are discouraging many landlords from investing in new homes to rent out.
“Ministers need to make pragmatic changes to their approach to private rented housing, with a series of policies that support, rather than attack, the majority of private landlords who are individuals to invest in the new homes to rent we need alongside all other tenures.
“This includes greater support and encouragement for those prepared to offer longer tenancies but who are concerned about being locked into agreements where tenants might be failing to pay their rent, not looking after their property or committing anti-social behaviour.”
The RLA is calling for a number of reforms to support those in rented housing, including:
- Waiving the stamp duty levy where landlords invest in property adding to the net overall supply of housing.
- Using a combination of tax incentives and improvements to the process for regaining possession of a home where tenants are neglecting it or not paying the rent. 73 per cent of landlord have told the RLA that they would be encouraged to offer longer-term tenancies if such reforms were made.
- Action to stop mortgage providers from prohibiting landlords from offering longer tenancies. 44 per cent of landlords have told the RLA that they have mortgage conditions that limit the maximum length of tenancy that can be offered.
- Establishing a new housing court to improve and speed up access to justice for tenants and landlords when things go wrong.
- Providing relief from Capital Gains Tax where a landlord is prepare to sell a property to a sitting tenant to support first time home ownership.