Lending giant urges support for landlords in the Budget

Lending giant urges support for landlords in the Budget

9:30 AM, 5th March 2024, About 2 months ago 8

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One of the UK’s largest buy to let lenders, The Mortgage Works (TMW), has called on the government to use the Spring Budget to introduce four key actions that will help the private rental sector.

TMW, which is part of Nationwide, said that many landlords are facing difficulties due to increased regulation and taxation, as well as higher interest rates.

This has, the lender says, reduced their incomes and their ability to invest in properties, leading to higher rents and lower standards for tenants.

The struggles that landlords face have also hindered their efforts to make their homes more energy efficient.

‘Landlords are a partner for the private sector’

Damian Thompson, a TMW director, said: “Landlords are a partner for the private sector and the government in driving the economy forward.

“The private rental sector provides homes for where the UK workforce is needed most.

“However, the current taxation system is counterproductive, hampering progress within the UK economy, and negatively impacting tenants and landlords.”

He added: “Without the Government permitting landlords to offset mortgage interest against their rental income or making equivalent interventions, tenants will face reduced choice, increased rents and potentially less well-maintained homes, and the UK economy will suffer as a result.”

TMW is asking the government to support landlords

The Mortgage Works is asking the government to support landlords in the following ways:

  • Moratorium: A moratorium on all but essential new regulation in the private rented sector following the introduction of the Renters (Reform) Bill. TMW says that landlords have been overwhelmed by a barrage of regulatory changes in the past decade and is urging the government to complete the passage of the Bill through Parliament and then provide a period for these changes to be implemented. It adds that a moratorium would provide certainty for landlords and allow the government to assess the impact of the Bill on improving the sector. This would also allow landlords to focus on providing quality homes for their tenants.
  • Incentivise efficiency work: TMW says that failing to incentivise landlords to make their homes more energy efficient is leading to increased energy consumption, negatively impacting tenants. It is urging the government to allow energy performance improvements to be deductible against rental income for tax purposes. This would help make energy performance investment more attractive for landlords and benefiting tenants.
  • Funding for social housing: The lender says it recognises that for many people, particularly the vulnerable, would benefit from affordable social housing. The government should ensure appropriate funding is available to deliver the extra 90,000 homes per year, as recommended by groups including the National Housing Federation, to relieve pressure on the PRS and support those most in need.
  • Mortgage interest relief and landlord taxes: TMW said it is calling on HM Treasury to review the impact of the scrapping of landlord mortgage interest relief, with the aim of reintroducing this financial support to retain landlords in the sector if they are thinking of selling due to other cost challenges. As well as reviewing the additional 3%, landlords must pay on top of their normal stamp duty payment, this cost acts as a barrier to new landlords entering the market, which would provide more properties. A review of the surcharge, including an analysis of its impact on the supply of private rented housing, should be undertaken to assess its impact and set a future direction.

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10:17 AM, 5th March 2024, About 2 months ago

Despite the shortcomings of the above, how is it that a lender is saying things that the NRLA should be promoting?

Markella Mikkelsen

10:21 AM, 5th March 2024, About 2 months ago

They are all great suggestions and we need organisations like TMW and others to lobby the government.

It's all been said before by landlords and landlord bodies like the NRLA but it has fallen on deaf ears. Maybe when lenders start screaming (because now it's hurting their pockets too when landlords are leaving the market), someone may sit up and listen.
Mr Gove - anybody there?

But changes won't happen overnight and the exodus will unfortunately continue until changes happen.

Old Mrs Landlord

10:32 AM, 5th March 2024, About 2 months ago

TMW - "part of Nationwide" - supporters of Shelter, whose lobbying has brought about many of the government's meddling measures which have brought the PRS to its current parlous state and who arguably have indirectly caused more homelessness than any other body by their attacks on private landlords. Talk about running with the hare and holding with the hounds! I suppose the drop in applications for BTL mortgages has hit them where it hurts and made them consider the landlords' viewpoint for once.

Mike Czuba

12:49 PM, 5th March 2024, About 2 months ago

Reply to the comment left by Old Mrs Landlord at 05/03/2024 - 10:32
The response from Hunt will be "absolutely nothing" and not even a reference to the hard pressed Landlord.. a complete denial that the Tory Gov when Osborn was Chancellor started this mess & War on Landlords.

Michael Booth

14:59 PM, 5th March 2024, About 2 months ago

Another bright idea ,when the landlords won't be there to lend to has they are and will be leaving the prs on mass, congratulations to shelter, goverment councils the lot of you are guilty of the mass destruction of the prs with all its consequences shame on you.

Fed Up Landlord

10:29 AM, 12th March 2024, About a month ago

The "cat's out of the bag" - they want landlords out of the PRS. As if we didn't know. LLs are the modern day pariahs and the cause of all the ills in the housing market. They are also easy targets for lefty bashing votes. The fact we are not building enough houses and have uncontrolled immigration has nothing to do with it has it?

Mike Czuba

11:16 AM, 12th March 2024, About a month ago

Reply to the comment left by Fed Up Landlord at 12/03/2024 - 10:29
Spot on.. they want us to own nothing, Blackrock, Vanguard etc are buying up all over the show.


11:22 AM, 12th March 2024, About a month ago

Reply to the comment left by Mike Czuba at 05/03/2024 - 12:49
Osbourne went on to lucrative pastures working for Blackrock who invest in build to rent.
Having pushed the BTL landlords aside to make way for the likes of Blackrock
by imposing a surcharge of an extra 8% capital gains tax and introducing section 24
Small wonder then that the conservatives are loosing the landlord votes.

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