Rent hikes are inevitable unless the government reverses tax changes for landlords, it has been claimed. Tenants face paying an average of £23 a month more in rent, totalling £414 across a typical 18-month tenancy, according to a number of agencies.
The forecasts are that the average national monthly rent, which it says currently stands at £918 a month, is set to rise by 2.5% in 2018.
Overall, they predict that around 2 million tenants across the UK will be hit with rent hikes totalling a combined £46m or so a month, as many landlords are forced to pass extra costs onto tenants by pushing up rents.
The government has attempted to create what the former chancellor George Osborne described as a “level playing field” between landlords and those buying homes to live in, by increasing taxes for landlords such as increasing stamp duty costs, cutting mortgage interest relief, scrapping the ‘wear and tear’ allowance, among other measures.
The impending tenant fees ban is also contributing to create a perfect storm of financial pressures on landlords, leaving many with little alternative but to increase tenants’ rents to cover their costs.
Renters in London
“Rents have already been increasing year on year, and it’s likely that 2018 will be the year that sees UK tenants feel the biggest impact yet from the recent changes introduced to the private rental sector.
“From our experience, we know many tenants are already stretching their monthly budgets to afford rental properties, and additional rent increases could be the final straw, tipping them into debt or rent arrears.”
“The value of these landlords cannot be underestimated, they are central to the UK’s rental sector and add valuable capacity to the market, and the Government needs to recognise this and start to support them, for the sake of the UK’s millions of tenants.”