The UK could be heading for a rental crisis, with experts dreading the prospect of a chronic property shortage in the PRS as more than a third of private landlords look to sell up in the next year in the face of lower profits, new research shows.
A wide-ranging study of 2,000 landlords by the Residential Landlords Association’s (RLA) research exchange, PEARL, has found that almost 34% of private landlords are looking to sell at least one property over the next 12 months.
The study also found that just 12% of landlords are looking to expand the number of homes they rent out, down from 14% a year ago.
Almost half of landlords – 45% – told the RLA that the 3% stamp duty surcharge on additional properties had been a deterrent to further investment in property.
The drop in housing supply comes at a time when the Royal Institution for Chartered Surveyors (RICS) is warning that the demand for private rented homes is on the up.
The RLA is now calling on the government to scrap the stamp duty levy where landlords provide homes adding to the net supply of housing.
This should include developing new build properties, bringing empty homes back into use and converting larger properties into smaller, more affordable units of accommodation.
David Smith, policy director for the RLA, commented: “This is yet more clear evidence of the sell-off of private rented housing largely due to the government’s extra tax on new rental homes.
“It is ridiculous that when the country needs all the extra housing it can get, it penalises good landlords who invest in new homes.
“With a new government and a Budget due, we need a shift in policy to one that supports investment because otherwise there will be a growing supply crisis in the private rented sector as demand continues to rise.”