Tenants in private rented housing are bearing the brunt of the Government’s tax increases on the sector. That’s the warning being issued by the Residential Landlords Association (RLA) as research shows the supply of homes to rent is drying up whilst demand continues to be strong.

Data released by the Royal Institution of Chartered Surveyors warns that whilst demand for rented housing from tenants “held more or less steady…for the third month running”, the number of landlord instructions “declined once again, rounding off a year in which they have fallen in all twelve months.”

The RLA is blaming the Government’s tax rises on the sector for the difficulties tenants now have in accessing suitable private rented housing. This includes the restriction of mortgage interest relief for the sector to the basic rate of income tax and a stamp duty levy which penalises the development of new homes to rent. This is despite the Chartered Institute of Housing recently noting that “tax reliefs deliver a much bigger benefit to home-owners than they do for private landlords.”

RLA policy manager, John Stewart, said: “Whilst the Treasury seeks to dampen investment in rented housing, demand from tenants shows no signs of slowing down. Recent tax rises have served only to make the housing crisis worse.”