Tax changes will hurt vulnerable tenants
Wednesday 15 March 2017
Vulnerable tenants will find it harder to access rented housing because of tax changes brought in by the Government.
According to data from the Royal Institution of Chartered Surveyor’s survey, around one third of respondents felt vulnerable tenants were finding it more difficult to access rented housing.
Last year, Dame Kate Barker, author of an independent review of UK Housing Supply for the Government, warned that tax changes risked some families facing eviction 'because the buy-to-let landlord no longer finds the yield acceptable or can’t afford it.'
Residential Landlords Association (RLA) policy director, David Smith, said: “The survey is a reminder that it is tenants who will ultimately suffer as a result of the Government’s punitive tax changes.
“We need a tax system that supports rather than hinders housing growth but yesterday’s budget did nothing to achieve this despite repeated warnings from the RLA and others over the last 18 months that these changes would have negative effects on landlords and tenants.
“Even at this late stage we call on all sides to work with the RLA as it develops its own blueprint for a sector that provides the homes to rent we so desperately need.”
The RLA has highlighted figures showing that surveyors believe private sector rents will increase by more than 20 per cent over the next five years.
In April, new rules will mean landlords are taxed on their turnover rather than profit, and mortgage interest relief will be cut to the basic rate of income tax over the next four years.
David Miles, a former member of the Bank of England’s Monetary Policy committee, expects that rents must rise by 20 per cent to 30 per cent for landlords to offset the impact of the tax changes and the stamp duty surcharge on the purchase of homes to rent out.
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