On Wednesday, Chancellor Jeremy Hunt is set to present his second spring budget since assuming the role, ahead of a potential general election later in the year.
Hunt has expressed a desire to decrease taxes in a “sensible” manner, but this doesn’t appear to extend to those who earn income from short-term rentals of their secondary properties.
After fourteen years of conservative rule marked by a more difficult environment for buy-to-let investments due to tax and regulatory shifts, there are now indications that the upcoming Budget will include a £300m tax increase on the rental market. This information comes from a report published by The Sunday Times, which is suspected to be based on a government leak.
Propertymark has voiced serious concerns about the potential consequences of this new tax increase on the rental sector.
“Reports in the news of a supposed £300m burden on landlords within the budget have drummed up significant concern,” says Nathan Emerson, CEO Propertymark. “This comes at a time when many landlords have exited the industry, and many are just barely managing to stay afloat.”
“Landlords, like regular homeowners, have been hit hard by inflation and rising interest rates. The UK government must acknowledge that maintaining a supply of high-quality housing, for both short- and long-term rentals, requires a system that is feasible to operate.”
“It is increasingly troublesome that the government continues to target landlords, to the point where the sustainability of rental investment is becoming a real concern both for current landlords and potential new investors.”
A spokesperson echoed these sentiments regarding the speculated tax changes in the budget, emphasizing the strain already placed on landlords by financial pressures and the need for the government to ensure a functional housing system.
Furthermore, the sporadic targeting of landlords is seen as detrimental, questioning the long-term viability of property investment for both existing and future landlords.
