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Government makes regular checks on how many landlords raise rents

The government's Office for National Statistics has revealed that it conducts an exercise to assess the likelihood that landlords will increase rents in England and in Wales.

The check takes place every 12 months in England and every nine months in Wales.

The latest check indicates that rents were more likely to have been hiked in England and Wales since the last check than they were a year earlier (63 per cent in England and 44 per cent in Wales).

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The hikes have been larger this time round, too: of those where rents had risen, in Wales they were up 11.3 per cent and in England 9.7 per cent. A year earlier it was 10.5 per cent in Wales and 8.4 per cent in England).

In England, rents are most likely to have risen in London (77 per cent) and least likely in the North West (42 per cent). However, those rents that did rise in the North West did so more than anywhere else – at an average of 12.3 per cent.

 

 

Greg Tsuman, president of ARLA Propertymark, says: “The rental market is clearly in the depths of a crisis, and it is under immense pressure from multiple fronts. The main issue, however, is that the Treasury seems to be overlooking the fact that it is eating the golden goose with the current tax structure imposed on private landlords.

“Section 24 of the Finance Act has forced landlords to pay taxes on turnover rather than just profit, meaning they are being taxed on interest payments, which have gone up from 0.1 to 5.25 per cent. Whilst it will come as some relief to private landlords that the Bank of England kept the base interest rate frozen, rates are still high, forcing landlords to increase rents and ultimately pass on these costs to tenants. But the ranks of landlords who are staying is dwindling, with many opting to sell up and leave altogether, further reducing supply of rental properties and forcing rents up even higher.   

“We need to urgently review the tax regime for private landlords and reintroduce mortgage interest relief by scrapping Section 24. 

“Simply put, I suspect the Treasury would be raising considerably more revenue from the buy-to-let sector if it hadn’t forced this mass exodus of private landlords, resulting in fewer paying taxes. We need to be bringing landlords back to the market, not forcing them out, so that we have a competitive market that keeps rents low. It is encouraging to see the government apparently taking note of this by recently rejecting rent caps, but the root causes of the rental crisis are still firmly gripping the sector, and they will continue to do so until the government acts.”

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    Section 24, EICRs, waste of time and money council licences, and now to really try and kill everything off the Renters Reform Bill (not landlords of course; it’s only about renters).

    Well ‘Here’s looking at you kid’. You can blame yourselves with all of that, and rent freezes and eviction bans.

    Then we have that angry backwards uneducated gym slip mum. The benefit claiming ginger person with her gutter mouth calling another MP scum in parliament looking to take over from the treacherous ‘can’t trust a word he says’ backing stabbing Gove.

    Mmmm……Do I want to be a this party? Or shall I go somewhere better?

  • icon

    It's surprising average rent rises have been so low. The inflation rate was higher for a large part of the quoted period. Even Social rents were increased by 7% in April but it was only that low because the government prevented the usual inflation linked increase.

    The tax system is dire and a major disincentive to people entering the industry. Huge SDLT, tax on turnover and 28% CGT when you sell. Very cautious lending criteria with incredibly onerous stress testing and falling property values. Maybe licensing or a non paying tenant. No wonder people aren't rushing to become landlords when better returns can be obtained from an interest bearing bank account.

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    Simply put Scrap The Renters Reform Bill that’s caused all this.The Government don’t need to move a limb to know how much Rents are rising, just look at your tablet and check what extra Sanctions and requirements you imposed during the year on landlords, you should know the extra burden you have put in place.
    Levelling up Committee says 24’000, were Served S.21 and due Council’s help. There’s the proof of the Damage, Cost to Council’s and Homelessness the RRB has caused otherwise it would be a fraction of this figure. Hence the real reason the Council’s and Government wants rid of S.21 and not the landlords fault at all.
    The Tenants will miss their S.21 for sure as the new Section 8 excludes this Requirement and Council’s no longer have a duty to House them following eviction, (any pennies dropping yet).

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    I have not been putting my rents up for years, but last year I did, and this year I have and next year I will 💵💵 Until I sell 🎉🎉 Let the chips fall where they will, this is not our doing. Those poor tenants ☠️ ⛪️

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    Ditto. And still £200 below market everytime I raise it. When they go. I sell. I'm out. 1 year, 10 years time.

     
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    My Rents are so much below the market but this has to change due all extra costs imposed. Also a house vacant at a time when it was never more needed but too scared to let it because of THE RENTERS REFORM BILL.

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    I have one empty house too since June and am too scared to let it…

     
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    I've just re let two in last 3weeks but rent increase of 30+% and still had people fighting for them.
    If I need them out for any reason there will always be a way!

     
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    @Michael, Nick - Scared of what though? If the RRB takes until at least October 2024 to come in then surely by not letting right now, cos of the fear of the possibility of a persistently non-paying tenant some time in the future that might takes ages to get rid of, that means having to take an actual definite loss from now onwards of how ever many months' rental income until a decision is made to risk letting after all or to sell in a less-than-frothy market? Why lose a year's rent now to avoid, say, a 10% risk of losing up to a year's rent in the future?

     
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    I am not sure whether considerations are being based anymore on when the provisions of the Renters Reform legislation will be in force.

    The date probably now under consideration is that of the next general election. Angela Rayner has said that Labour will abolish Section 21 immediately on taking power.

    Will the next general election be in May 2024?

     
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    HouseMartin,

    It's about piece of mind. Labour and the Tories can't be trusted. Ae Ellie say Rayner wants to abolish S21 on day one. I don't see she can but the could do eviction bans, rent friezes etc. I just want out.

     
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    She couldn't have said anything more harmful to existing tenants than that.

    If she had said instead Labour legislation will not apply to existing tenants for three years, then existing tenants would have been secure in their accommodation for a considerable period of time.

     
  • icon

    Slightly off this thread but I have wondered the following for some time. Why should a property, being purchased by a landlord for permanent residency by a tenant, attract the same level of tax, and be classed as, a ‘second home’?

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    No reason, other than to increase the treasury's coffers. Even if it's seen as an investment you don't pay tax when buying said investments, only CGT when you sell.

     
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    A couple of my buy to lets are in a very sleepy town where the market is very slow and I often have a room or two to let. But this year I've recently found myself turning a stream of people away who are desperate for somewhere to live, and that's even after I've gradually raised rents to cover increasing costs.

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    Yep. I had 100 enquiries in 3 days. openrent paused the advert. People are desperate. Perhaps the ONS should be measuring that!! Desperation levels among tenants or number of applicants per property perhaps.

     
  • John Wathen

    With 5 years of a Labour government looking increasingly likely, by 2029 the PRS will hardly exist. They forget there are other ways to invest hard earned savings & we are not a public service to be demonised & exploited. Social housing is badly run & underfunded so the prospect of mass homelessness in the near future is inevitable. Narrow minded pressure groups & misguided politicians will be entirely to blame!

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    Yes House Martin. I should be sacred of Renters Reform Bill designed to Collapse the Market & Create Homelessness and succeeding very well at the moment. I fear loss of Rent far less than a Sitting Tenant.
    I am surprised you mentioned selling as an option which it is not that is getting rid of you, like the scrappage Scheme (just scrap ur van collect £7k for nothing stop working & Mr Khan think it a good idea) you are out then pay 28% c/gains just to reduce the value of your Estate, then when you die pay another 40% inheritance tax, so was it ever worth buying the House in the first place. What does it matter if it’s vacant and paying c/tax or they have double c/tax on
    empty property. Mr Hunt a medical man an excuse for a Chancellor will be loosing more than he gains, he won’t be getting 45% of the income tax on money I didn’t get.

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    I feel as you do, Michael. I can put up with loss of rent, but not sitting tenants.

     
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    Greg Tsuman, president of ARLA Propertymark, says: “The rental market is clearly in the depths of a crisis . . . the main issue, however, is that the Treasury seems to be overlooking the fact that it is eating the golden goose with the current tax structure imposed on private landlords."

    Ben Beadle of the NRLA says, ". . . . . . . . . "

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