A trade body says new figures released by the independent Office for Budget Responsibility show that the government’s recent tax increases are choking off investment in rented housing.
The Residential Landlords Association says the OBR’s Economic and Fiscal Outlook - published this week to coincide with Chancellor Phillip Hammond’s Spring Statement - speaks of “subdued growth in residential investment.”
The RLA links this to recent tax hikes on private rented housing, including the three per cent stamp duty surcharge on the purchase of new homes to let out, and the restriction of mortgage interest relief to the basic rate of income tax.
Alan Ward, RLA chair, says this shows “the folly” of taxing the supply of new homes to rent.
“It is more important than ever that we recognise the dynamic role the rental market can play in swiftly responding to the country’s ever changing housing needs” he says.
“The government should come forward with a package of pro-growth tax and planning policies to support private landlords who want to invest in the new housing the country needs if renters are to be able to find the accommodation they want.
“The build to rent sector is not delivering at the rate required and in the past private landlords have delivered three out of five of all new homes.”