Scrapping Landlord Tax Relief will push up rents claim IMLA
Posted on 02/11/2015 by Sulgrave Estates
The Intermediary Mortgage Lenders Association (IMLA) have said that removing tax relief for landlords will restrict the supply of rental properties which will make life much harder for tenants. Measures that discourage investment in the PRS will only push rents up.
IMLA further said that the removal of the higher rate tax relief would push some investors into losses. Whilst this may “slightly skew the market in favour of owner occupied house hunters by reducing the price landlords are prepared to pay for any given property”, it warned “discouraging investment in the private rented sector will put more upward pressure on rents.”
The one and two bedroom properties favoured by investors are the very same properties that appeal to first time buyers. Rightmove have advised that competition for these properties has pushed up prices by 10% in the last year. There is also growing disquiet among would be buyers who are concerned that they are losing homes to investors who do not have to go through such strict affordability checks to obtain a mortgage.
IMLA’s executive director, Peter Williams, said “Until there is a broader policy push to tackle the chronic lack of supply, homeowners and renters in both private and social sectors will all remain vulnerable to the effects of the current lack of fully joined up policy making.”