Mortgage Finance:

A leading association for mortgage lenders, The Intermediary Lenders Association (IMLA) is calling on the Government to put a stop to its legislative interventions in the buy-to-let market.

As reported by financialreporter.co.uk, the IMLA’s new report is warning the Government that the private rented sector is “still absorbing the adverse effects from recent tax and regulatory changes”, which it says “may force some landlords out of the sector”.

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“We are concerned that layers of government intervention have adversely affected small-scale landlords’ ability and appetite to invest in properties over recent years,” says the IMLA.

Any more changes, it says, would have an adverse effect on “much-needed” tenant choice and potentially raise rents.

The IMLA says, The English Private Landlord Survey 2018, published by the Ministry of Housing, Communities and Local Government, shows for the first time that professional landlords now account for a bigger proportion of the PRS than small-scale landlords.

According to the Government survey professional landlords now represent 48% of the PRS, which is up from 38% in 2010. At the same time the number of single-property landlords has dropped from 40% to just 21% over the nine year period.

Legislative changes were cited in responses to the survey as the main reason for small-scale landlords planning to sell some or all of their properties – 61% cited these legislative changes as the reason.

Kate Davies, executive director of IMLA, commented: 

“The UK’s private rented sector is under significant pressure. Landlords up and down the country are effectively having to fill the gap left by a shrinking social housing sector that is struggling to accommodate demand from lower income households.

“At the same time, it must continue to meet the needs of people who either want the flexibility of renting or who are not yet able to step onto the housing ladder in the face of increasing house prices and tighter mortgage regulation.

“We are concerned that layers of government intervention have adversely affected small-scale landlords’ ability and appetite to invest in properties over recent years.

“As increased tax and regulatory responsibilities increasingly disincentivise landlords, we face a possible topping out of the PRS. While it’s good to see professional and institutional investors increasing their stake in the nation’s housing stock, the number of one-property buy-to-let investors has fallen by almost half.

“Squeezing the PRS puts the pressure on millions of renters in Britain. We are strong advocates of a fair market with a quality supply of homes. Restricting the PRS risks a lack of supply, rising rents and a fall in the quality of rental accommodation.

“We have repeatedly called for Government to put the brakes on regulating and taxing our nation’s landlords. We urge a more moderate approach to ensure our private rental sector remains strong for the millions of renters who rely on it.”

New IMLA report: ‘Buy-to-let: under pressure’

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