24 Mar Spring Budget ignores private rented sector, but Housing Hand points out hidden gems for tenants
While the Spring Budget quite pointedly ignored landlords and, indeed, the private rented sector as a whole, there were a few hidden bonuses tucked away in it for tenants, according to UK rental guarantor service Housing Hand.
“The extended energy price guarantee should keep costs under a modicum of control, meaning that some tenants will be in a better financial position that they would otherwise have been. When the new support with childcare costs kicks in next year, that will make a major difference to many tenants, potentially saving them thousands of pounds per year.”
Graham Hayward, Chief Operating Officer, Housing Hand
Higher earning tenants may also benefit from getting better savings thanks to the pension incentives announced in the Spring Budget, though tax band changes could mean exposure to higher bands.
For landlords and those providing purpose-built student accommodation and Build to Rent homes, however, the Budget was distinctly lacking. Neither stamp duty cuts nor the reinstatement of tax relief on mortgage interest payments made it into the Chancellor’s plans. The only real impact that some might feel is the increase in Corporation Tax from 19% to 25% where profits exceed £250,000.
“The Spring Budget didn’t contain much of interest to landlords, but it wasn’t so much a missed opportunity as a pause until the Renters’ Reform Bill comes into force, which the Government has committed to doing by the time the current session of Parliament ends in May. That’s when we expect to see real operational changes impacting the private rented sector. If passed without amendment, it will make it illegal to discriminate against benefit claimants by refusing to rent homes to them and protect tenants from ‘no fault’ evictions by abolishing section 21 notices.”
James Maguire, Head of Sales and Business Development, Housing Hand
The private rental sector has grown rapidly over the past couple of decades. Back in 1997, 55% of adults aged 25-34 in the UK were homeowners. Just 20 years later, that figure had plummeted to 35%, according to the Institute for Fiscal Studies, with middle-income young adults experiencing the largest falls in home ownership.
“As the private rented sector continues to grow, it becomes more important to control and regulate it as we move forward. We’re already seeing a lack of supply, resulting from policy decisions over the past few years, pushing rental prices up for both students and working professionals in key urban areas. It’s essential that Government addresses this swiftly and comprehensively if we are to have a well-functioning rental sector. In the meantime, Housing Hand will continue to build our guarantee services, to ensure as many people as possible can get the property they want/need.”
Graham Hayward, Chief Operating Officer, Housing Hand
