NRLA chief executive Ben Beadle on a quiet budget for landlords – and what further action the Government needs to take to bring about real change.
It could be argued that a quiet budget is a good budget.
Aftershock announcements on stamp duty and mortgage interest relief in recent years, we welcome the fact there were no nasty surprises announced by the chancellor this week. Safe to say that numerous briefings were made by the Association on behalf of members, and there are indeed some positives to report.
Fears that capital gains tax could be increased in line with income tax proved unfounded, and the chancellor also took the opportunity to confirm the current stamp duty holiday will be extended to help buyers struggling to complete on time.
Despite this, it came as a big disappointment that, while pledging to do ‘whatever it takes to support those affected’ Rishi Sunak refused to offer ringfenced financial support to landlords and tenants struggling as a result of Covid-19.
This is despite the English Housing Survey showing private renters have been the hardest hit.
The NRLA had called for a package of measures that would include interest-free hardship loans, allowing tenants affected by Covid-19 to borrow money to pay off arrears, key to helping tenants pay their rent and stay in their homes.
Figures show that most of those in arrears are unable to access emergency housing support from local authorities and the potential consequences are serious.
Some tenants face losing their home and serious damage to their credit score – ultimately undermining the Government’s efforts ‘to help generation rent become generation buy’.
There were other missed opportunities. The Government could have demonstrated its commitment to its green agenda by giving more explicit support to the private rented sector, for example to help landlords meet minimum EPC standards.
This is something we will continue to press the Government on as we await the findings of its consultation into plans to raise minimum EPC levels to a C.
Additionally, incorporated landlords need to be aware of the increase in corporation tax from 19%, up to 25% in 2023 if their profits are over £50,000 per year. While this will be implemented on a sliding scale – meaning those with the smallest profits see the smallest increases – it is something they will need to keep an eye on.
One small silver lining was the announcement that the £20 uplift in Universal Credit payments will remain for a further six months.
This was something we at the NRLA had called for in our budget submission. However, we now want to see a long-term commitment from the Government to support those who need it most.
Going forward we will continue our calls for a comprehensive package of financial support for the sector to help sustain tenancies, particularly as possession restrictions start to lift.
We will also continue to lobby the Government to ‘tax smarter’ by offering incentives to landlords who are bringing new homes to the rental market – or selling to first-time buyers.
While this budget did bring some disappointments there was no news of the rumoured tax raid on the sector and that can only be good news.
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