According to Philip Inman, Economics Correspondent in the Guardian, the answer is an unequivocal: “Yes”. He says landlords are taking advantage of generous tax allowances and cheaper mortgage rates, but failing to spend any of their profits on the housing stock. He describes the buy to let housing sector as the “route to riches for those denied a big win on the lottery” and calls it a disaster for UK Plc.
Short Term Tenancy Agreements
Now that the banks have made it easier for landlords to take out loans to buy investment property, many landlords are snapping up property at the cheaper end of the market at the expense of first time buyers. At the same time many lenders are forcing landlords to only offer six-month contracts to tenants. Mr Inman says this is causing friction between landlords and tenants. However, in reality most landlords are more than happy to let good tenants stay long-term because it is better for everyone.
Chartered Institute of Housing Advice to Government
Gavin Smart from Chartered Institute of Housing (CIH) believes the government needs to review landlord tax allowances:
“Private landlords currently benefit from around £7bn of tax allowances per year for deductible expenses such as repairs and maintenance, insurance and professional fees, but [ministers] don’t target or incentivise higher standards. If landlords who committed to a higher level of standards benefited from a more targeted allowance, while those who did not saw their allowances stay the same or even reduce, the government could encourage higher standards – without needing to find any extra money.”
Your thoughts?
