Plea for Government help for private rented sector tenants
Leeds estate agent, HOP, has written an open letter to Michael Gove, urging the Government to address the chronic shortage of rental properties in the private rented sector (PRS), which is making life increasingly difficult for tenants.
The letter to the Secretary of State for Levelling Up, Housing and Communities, follows a consultation with HOP’s landlord clients, tenants and other industry professionals working in the PRS.
As well as addressing the current challenges, the letter offers recommendations about how the Government could slow the exodus of landlords who are selling investment properties and exiting the market.
HOP manages one of West Yorkshire’s largest rentals portfolios, worth more than £245m. It expects rents to increase by another 7% in 2023, which follows a 10% rise in 2022.
The company’s recommendations include:
- Removing the 3% additional homes stamp duty and instead charge landlords selling additional homes the 3% stamp duty levy, to incentivise landlords to purchase new buy to let (BTL) properties.
- Incentivising the transfer of BTL property into limited company ownership by removing the 3% stamp duty levy for a 12-month period. This would enable landlords to pay tax on profit rather than revenue and would help to professionalise the industry further.
- Providing more certainty over upcoming rental reforms and streamlining and simplifying the Section 8 eviction process. This would enable landlords to evict bad tenants and ease their concerns about the removal of Section 21s.
Luke Gidney, managing director at HOP, which has offices in Leeds city centre, Horsforth and Pudsey, said: “Legislation, red tape and tax changes that were all designed to make buy to let (BTL) properties less appealing to landlords, have had a bigger impact on the rentals market than anyone could have imagined.
“Unfortunately, Chancellor Jeremy Hunt had an opportunity to address this in the Budget but failed to do so.
“We’re now in a position where demand for rental property is higher than it’s ever been, and tenants are finding themselves in fierce competitions for available properties and having to pay record rents, which comes against a backdrop of sky-high energy bills and the cost of living crisis.
“Plus, tenants now often find themselves stuck wherever they’re living and are moving less regularly, for fear of not being able to find and secure another suitable home.
“More housing stock in the private rented sector would give tenants more choice and ease the burden on rents.
“It’s a critical situation and although we primarily represent our landlord clients, it’s also important our tenants, and thousands like them, have a voice as well.”