An international agent has issued a stark warning to Labour that a further raft of landlord taxes will cause many to jump ship and sell up, inevitably leading to higher rents and more tenants ending up on the streets.
Chief executive of the agents, Dominic Agace, states that Keir Starmer’s demand for new taxes to be imposed on landlords in his speech to the Local Government Association conference, will almost certainly cause landlords to sell their properties, or put the extra cost/tax onto tenants’ shoulders.
Agace says: “This could push landlords to sell off more properties, reducing supply and leading to rent increases – which would be more costly to working people needing to rent than the 1.25 per cent rise in National Insurance.
“A healthy private rental sector is essential and landlords can’t be pushed much further in areas such as London where yields are already very low and rents have declined significantly as a result of the pandemic.”
Agace wants the Chancellor to encourage landlords to buy more ‘rental’ properties by offering new incentives for BTL investors in his Autumn Budget.
In the agency’s latest podcast he says that many BTL investors have sold off properties in London because of the changes to mortgage tax relief together with the 3 per cent surcharge on ‘second’ homes.
He says: “30 per cent of homes in London are in the private rented sector. Young professionals coming to work in London to build a career need to be based in the capital and it is critical that housing stock is here and affordable. It is important that they are able to come to ensure our continuing status as a global centre. There has to be a balance of fairness between tenant and landlord.”
He adds: “Prices in central London have come down so it is a good time to invest and make the most of the capital growth and increasing rents as people return to the capital. However, landlords need some fresh encouragement from the Chancellor to invest in London.”