Rishi Sunak's first Budget included new taxes for overseas property buyers, funding to remove unsafe cladding, fresh funds to support the construction of new homes delivery and money to tackle homelessness, but there was no reversal of the previous chancellor George Osborne’s deeply unpopular tax reforms that have had far-reaching implications for the buy-to-let sector.
The government’s decision to phase out mortgage interest tax relief and introduce a 3% stamp duty surcharge for additional properties is having a detrimental impact on households up and down and the country, and yet the new chancellor opted to ignore the issue, despite the fact that there is plenty of evidence to suggest that the tax clampdown on landlords is resulting in rent increases for tenants across the UK.
The average rent in the UK rose to £955 a month, 1.6% higher than in the corresponding month last year, owed in part to the widening supply-demand imbalance in the PRS, according to the latest HomeLet Rental Index.
Franz Doerr, founder and CEO of flatfair, said: “The chancellor has made some welcome announcements about housing, but it is crucial that this government recognises that there needs to be equal efforts made towards making renting fairer for the millions of people up and down the UK renting for longer than ever.”
But some in the letting sector would have been relieved to see that there will be a delay in the Renters' Reform Bill.
Neil Cobbold, chief sales officer at PayProp, commented: “Removing Section 21 from the Housing Act 1988 is a huge change to the evictions process. It’s vital that input from the industry is considered when this measure is debated in Parliament in order to get the best outcome for all parties.
“Lettings professionals will also want to see how the court system will be reformed to oversee the new system.
“The introduction of lifetime deposits could have a range of advantages for the rental sector – and particularly for renters. However, it will be important for politicians to consider input from the sector when deciding how a new deposit system could work.”