New communities secretary Robert Jenrick and housing minister Esther McVey look set to focus on increasing homeownership, but this appears to be at the expense of tenants in the private rental market, according to the Residential Landlords Association (RLA).
Fresh data from the Royal Institution of Chartered Surveyors (RICS) reveal a drop in the supply of private rented housing at a time when demand from prospective tenants is rising and this is likely to push rents higher.
Tenant demand has picked up despite the government’s efforts to boost homeownership. But over recent years tax changes by the government, including restricting mortgage interest relief to the basic rate of income tax and introducing a 3% stamp duty levy on the purchase of new homes to rent out, have led some landlords to leave the market.
Yet, the Institute for Fiscal Studies has warned that it was “plain wrong” to argue that landlords were taxed more favourably than homeowners.
The Chartered Institute of Housing has also noted that “tax reliefs deliver a much bigger benefit to home-owners than they do for private landlords.”
David Smith, policy Director the Residential Landlords Association, commented: “These figures demonstrate yet again that hitting the private rented sector to boost homeownership serves only to hurt tenants.
“Demand from tenants and new buyers is increasing at the same time. It is vital that the needs of both groups are met.
“The government needs to stop making landlords the scapegoat for the housing crisis and embark on a raft of pro-growth measures to boost the supply of homes for the private rented sector. If they do not, supply will continue to fall, meaning higher rents, less choice, and a reduction in quality for tenants.”
