With the shortage of rental homes growing, Propertymark urges the incoming government to rethink landlord taxation to boost buy-to-let investments.

Demand for private rentals keeps rising, but new data from Rightmove reveals a significant drop in available rental properties. More tenants are opting to renew leases instead of moving, exacerbating the supply-demand gap in the private rental sector (PRS).

Nathan Emerson, CEO of Propertymark, stated: “We have long advocated for increasing housing in the PRS to stabilize rents, but various factors are needed to make the market appealing for both investors and tenants.”

Recent tax relief changes for buy-to-let landlords have discouraged many from investing in the PRS, significantly reducing net rental returns. This shift has mainly hurt tenants, as landlords increase rents to offset their losses due to government tax policies.

Emerson continued: “With a general election approaching, Propertymark urges the next government to reform the tax system to attract more investment in the PRS, ultimately lowering rents for tenants.”

He also noted the importance of a balanced approach: “We support increasing housing supply but advocate for sensible programs that protect the green belt. Additionally, avoiding rent controls, which have had detrimental effects on Scotland’s PRS, is crucial.”