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Posted on August 5th 2015 by admin-movingin

Tenants fear that tax break costs mean higher rents

A survey suggests that renters are worried that landlords who have to pay more tax as a result of changes in buy to let allowances will make up the shortfall by hiking rents.

Results from the poll of 1,000 tenants conducted late last week show that over 50 per cent of tenants want rent controls to be introduced, while over 35 per cent would attempt to move to cheaper properties if rents in their existing homes were increased. 

If rents did rise just 20 per cent said they would remain in their existing homes whatever the rise, while 17 per cent suggested they would be more motivated to buy and quit the rental sector completely.      

The issue has arisen as a result of tax changes introduced in last month’s Budget. 

Chancellor George Osborne announced that from 2017 he would be clamping down on buy to let landlords by removing the right to claim more than the basic rate tax equivalent in relief for mortgage interest. He is also tightening the rules about claiming for wear and tear by allowing claims only for money spent rather than the annual 10 per cent of rental that’s currently allowed automatically.

Insurance provider Makeitcheaper – which commissioned the poll – says the possibility of increased rents may heighten tensions between tenants and landlords.