31 Jan

Tax changes may lead to higher rents

Tax changes may lead to higher rents

Many landlords are set to increase rents as a result of the government’s proposed tax changes.

Research from property management company Orchard and Shipman found that 86 per cent of landlords believe the new tax laws will prevent investment in the buy-to-let housing market, while 90 per cent feel rents will have to increase due to a shortage of suitable rental properties.

However, just 18 per cent of landlords involved in the survey felt they would withdraw from the rental market altogether, although 25 per cent confirmed they may look at reducing their current property portfolio following the changes.

"The Government’s changes to the way buy to let investors are taxed will inevitably impact revenue. The shortage of housing, a growing rental market and rising property prices is driving increased demand for rental properties," explained Shane Spiers, chief executive officer of Orchard and Shipman Residential.

"With these market conditions at play, it’s no surprise that landlords will be putting up rents to supplement their income. Unfortunately, it is tenants that will feel the brunt of the tax changes,” he added.

From April this year, buyers of buy-to-let or any other second homes will have to pay three per cent more in stamp duty at each price banding.ADNFCR-1222-ID-801811572-ADNFCR

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