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Tenants in private rented housing are bearing the brunt of the Government’s tax increases on the sector.That’s the warning being issued by the Residential Landlords Association as research shows the supply of homes to rent is drying up whilst demand continues to be strong.Data released today by the Royal Institution of Chartered Surveyors warns that whilst demand for rented housing from tenants “held more or less steady…for the third month running”, the number of landlord instructions “declined once again, rounding off a year in which they have fallen in all twelve months.”The RLA is blaming the Government’s tax rises on the sector for the difficulties tenants now have in accessing suitable private rented housing.This includes the restriction of mortgage interest relief for the sector to the basic rate of income tax and a stamp duty levy which penalises the development of new homes to rent. This is despite the Chartered Institute of Housing recently noting that “tax reliefs deliver a much bigger benefit to home-owners than they do for private landlords.”RLA Policy Manager, John Stewart, said:“Whilst the Treasury seeks to dampen investment in rented housing, demand from tenants shows no signs of slowing down. Recent tax rises have served only to make the housing crisis worse.“Rather than seeing it as a problem to be managed, the Treasury needs to develop a series of pro-growth tax measures that support and encourage the majority of good and decent landlords to provide the new homes to rent we desperately need. Otherwise tenants will find it increasingly difficult to find suitable homes to rent at affordable prices”.The commentary comes in the wake of Rightmove reporting that rents are starting to rise due to dwindling stock:Data from the property website Rightmove showed rent levels continuing to rise. Average asking rents in London hit an all-time high of £2,034 in the fourth quarter of 2018 as the number of available properties dwindled . Compared with a year earlier, the number of properties available to rent is down 22%.
Rightmove is predicting that asking rents will rise 4% in London this year and by 3% outside the capital.UK house prices fall at fastest rate in six years on back of Brexit – Rics It would be interesting to hear from PT members if you think rents are rising, stagnant, or declining in your area?Even if rents were supposedly on the rise, I would not be putting them up in the current conditions. Good tenants who pay their rent on time are worth their weight in gold in 2019 imho and I won't be doing anything to rock the boat!SEE ALSO - Rental market after Brexit?UP NEXT - Where have all the tenants gone?DON'T MISS - Rents to rise 15% in next 5 years say RICSNOW WATCH:
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
I take the opportunity to raise rents when I have voids
I am not increasing rents for current customers.
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
Same strategy here, for 2019 anyway.
I’ve had four voids and everyone has achieved an increase
every little helps
Certain part in Yorkshire.
Rents in my area are falling when it comes to flats but rising for houses near good schools.
Sale House prices are down despite some areas are still way behind 2007 prices.
The increasing tax burden on landlords is likely to result in increased rents, according to research from the Intermediary Mortgage Lenders Association (IMLA).
While rental prices continue to be subdued and below the rate of consumer price inflation across much of the UK, as reflected by the latest ONS data, landlords are now facing the challenges of increased legislation and changes to mortgage interest tax relief.
Kate Davies, executive director, IMLA, said: “As buy-to-let borrowers start to feel the effects of income tax changes reflected in their most recent tax bills, the pressure to increase rental prices is likely to mount.”Full/source article