Landlords could be further hit following recent Budget announcements, experts believe, with aspiring first-time buyers facing a possible knock-on effect.
Although the recent Budget was widely regarded as being neutral to the property market, some parts of the chancellor’s report gave landlords reason for concern.
Some landlords were concerned that the chancellor would crack down on a recent trend for many to form limited companies to avoid tax.
Chancellor Philip Hammond said in his Budget speech: “We must ensure that our corporate tax regime does not encourage people across the economy to form companies simply to reduce tax liabilities, pushing the burden of financing our public services onto others.”
A Residential Landlords Association (RLA) spokesman said that making incorporating less appealing means landlords could switch to providing short-term holiday lets or else leave the market altogether.
However, Chris Norris, head of policy at the National Landlords Association (NLA), said: “We are concerned, but not overly concerned at the moment. We don’t think we are directly in the firing line.”
Mortgages for Business chief executive, David Whittaker, said that the chancellor is not targeting landlords with the announcement. He said: “This isn’t about landlords, it’s about people who artificially manufacture their employment contracts so as not to pay their fair share of tax. While landlords might perceive they get caught in it, I think he’s lost interest in landlords.”