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The Mortgage Works has urged the Government to introduce four key actions that will help build a stronger private rental sector (PRS).

The buy-to-let (BTL) lender called for a moratorium on all but essential new regulation in the PRS following the introduction of the Renters (Reform) Bill.

The Mortgage Works urged Government to complete the passage of the Renters (Reform) Bill through Parliament as soon as possible, and then provide a period for these changes to be implemented.

A moratorium, the lender argued, would provide certainty for landlords following a period of change and allow Government to assess the impact of the Renters (Reform) Bill on improving the sector.

The Mortgage Works also suggested incentivising landlords to carry out energy efficiency work, allowing energy performance improvements to be deductible against rental income for tax purposes.

It also called for an increase in funding for social housing, whereby the Government could ensure appropriate funding to deliver the additional 90,000 homes per year into the social housing sector, as recommended by groups including the National Housing Federation.

Finally, The Mortgage Works called for a review of changes to mortgage interest relief and landlord taxes, reviewing the impact of scrapping landlord mortgage interest relief, with the aim of reintroducing this financial support to retain landlords in the sector if they are thinking of selling due to other cost challenges.

The lender said these measures should be done as well as reviewing the additional 3% landlords have to pay on top of their normal Stamp Duty payment.

Damian Thompson, director at The Mortgage Works, said: “Landlords are a partner for the private sector and the Government in driving the economy forward.

“The private rental sector provides homes for where the UK workforce is needed most.

“However, the current taxation system is counterproductive, hampering progress within the UK economy, and negatively impacting tenants and landlords.

“Without the Government permitting landlords to offset mortgage interest against their rental income or making equivalent interventions, tenants will face reduced choice, increased rents and potentially less well-maintained homes, and the UK economy will suffer as a result.”

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