17 May

Landlords look to cut costs

Landlords look to cut costs

Landlords may be hoping to reduce their annual spending as they face increased tax burdens, but this may have an impact on other industries, claims a property firm.

Kent Reliance, a mortgage lender and part of OneSavings Bank, conducted research that found decisions by landlords could have consequences for tradespeople and other professionals connected to the property industry.

It is estimated landlords currently contribute £15.9 billion per year to the British economy as a result of a strong increase in the private rented sector in recent years.

The largest cost for landlords is the property upkeep, maintenance, and servicing which totals around £5.5 billion, with a further £2 billion spent on services changes and ground rent, £963 million on insurance and £904 million on utilities.

However, recent tax changes mean some landlords are not looking at ways to reduce their outgoings in order to meet higher tax obligations.  It is estimated around 36 per cent of landlords are planning to lower their spending in some way, with 17 per cent having identified property upkeep and maintenance as a key area for cutting costs.

“Landlords may seem like an easy target for political point scoring, but they play a vital role in the economy. Not only do they house a huge proportion of the country’s workforce, bridging the housing demand and supply gap, their spending supports thousands of jobs whether builders, cleaners, lawyers and accountants or letting agents,” said John Eastgate, sales and marketing director of OneSavings Bank.

He added: “One side effect of the recent changes, and rising running costs, will be the professionalisation of the sector as amateur and accidental landlords leave the market. There is nothing wrong with having fewer, bigger landlords, but that alone will not help more young people get homes."ADNFCR-1222-ID-801835868-ADNFCR

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