Thanks to higher costs that include increased stamp duty and less tax relief on commercial mortgage interest payments, some landlords have soldtheir properties and left the buy to let market. Other landlords have formed limited companies to own their properties because this can save tax. Some experts have predicted the end of the traditional buy to let landlord who owns one or two properties.
Alan Ward, chairman of the Residential Landlords Association believes that traditional landlords are here to stay. He admits it is more difficult to be a profitable landlord, but demand for private rented accommodation is high. The government is encouraging new-build-to-rent developments, but Alan Ward believes that this will not meet the demand for rented accommodation.
The Royal Institute of Chartered Surveyors has predicted that the UK will require an additional 1.8 million rented homes by 2025 – a 38% increase on the present number. Unless these extra rented homes are provided, the UK will see a housing crisis.
The government is said to have discouraged landlords from purchasing buy to let property. Alan Ward wants the government to recognise the positive contribution that private landlords have made in the housing market. He said:
“Landlords ask for nothing more than a fair deal from the Government – clear, practical and workable legislation, reducing the regulatory burden on responsible and professional landlords to create a healthy and robust private rented sector for the benefit of all.”