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1 in 5 landlords intend to sell up
The number of landlords planning to reduce their residential portfolio has hit a 10-year high, according to the National Landlords Association (NLA).
Research by the NLA, which has more than 65,000 members, shows 20% of landlords are considering selling up after the government announced a series of tax changes.
These include the withdrawal of mortgage interest relief for higher and additional rate taxpayers, a 3% surcharge on additional property purchases and a ban on upfront letting fees for tenants.
Changes to tax relief on finance costs on residential properties were introduced on 6 April 2017, and when fully implemented, will restrict costs to the basic rate of income tax.
Before April 2017, landlords could deduct their mortgage interest costs from their income as part of their tax return.
Richard Lambert, chief executive of the NLA, said:
"The government needs to look at the impact these policies will have on the private rented sector.
"More and more people are relying on this sector for a home, so it is vital that landlords not only provide a high standard of accommodation, but are incentivised to do so by the prospects of a reasonable return on investment.
"It is our view that these policies are undermining the viability of many landlords' businesses and removing the incentives to invest in residential property for business purposes."
Contact us about tax changes that affect landlords.