Warning to Labour leader - no rent controls, yes to lower taxes

The new Labour leader in Wales, Vaughan Gething, has received an early shot across the bows from Propertymark.

Gething was elected Welsh First Minister on Saturday, a move which prompted an immediate statement from Nathan Emerson, chief executive of Propertymark.

He says: “We welcome Vaughan Gething into his position as Leader of Welsh Labour and subsequently the First Minister of Wales and look forward to continuing to champion the role of property agents and ensure there is investment and support for all housing tenures.

“Mr Gething must look to boost the supply of private rented sector properties to give more affordable housing options to the most vulnerable contract holders, until levels of social housing catch up.  This should be achieved by rejecting rent controls, reducing Land Transaction Tax for additional properties for landlords, and providing additional support to make empty properties become future homes.

“The new First Minister, as part of his government, should use the review of Rent Smart Wales to encourage further professional standards for property agents and look towards the Scottish system of legislation which encourages greater professional development through qualifications.  There should also be a pause on any further legislation to allow property agents and landlords to be fully compliant and understand the Renting Homes Wales Act.

“We welcome Vaughan Gethin’s pledge to build more affordable and social homes, which we called for as part of our Senedd Manifesto. However, we would further welcome greater clarity on how he will increase supply in the private rented sector and encourage homeownership in Wales.”

Separately, Propertymark has responded to a Parliamentary consultation by urging a review of all the taxes that currently hurt the viability of the private rental sector.

In its oral evidence to the Welsh Parliament’s Local Government and Housing Committee inquiry into the private rented sector, Propertymark demanded a comprehensive review on taxes that impact landlords, including the impact of Land Transaction Tax - the Welsh equivalent of stamp duty.

Evidence was also presented regarding the damage of rent caps and potential plans for proposals across Wales. Propertymark outlined the detrimental effects already witnessed within the private rented sector across Scotland following their introduction - with rent caps contributing to a near 13% increase in rents and have caused investment in the private rented sector across Scotland to stall. 

This has also contributed to housing supply issues, as many letting agents and their landlords experience new pressures and uncertainty, as well as potential increases in overheads which must be planned for.

Timothy Douglas, Propertymark’s Head of Policy and Campaigns, says: “The private rented sector in Wales has undergone huge and significant change via the Renting Homes (Wales) Act so it now time for policy makers to reflect on the implementation of these reforms and allow time for letting agents, landlords and tenants to understand and apply the changes. 

“To help meet the demand crisis for rented homes, the Welsh Government need to understand recent tax changes that have impacted landlords and use the policy levers at their disposal by reducing higher rates of Land Transaction Tax on buy to let property. 

“Our message is clear on rent control that it must be avoided at all costs and through introducing a Welsh Housing Survey, a more accurate picture of housing and renting in Wales can be established that can help lead to pro-growth policies and a mix of housing options that work for everyone in Wales.”