The Council of Mortgage Lenders (CML) says improving conditions in funding markets – and competition between lenders – is delivering a wider choice for landlords and tenants.
However, it says it is crucial, however, to ensure that regulatory requirements do not place unnecessary burdens on landlords. In particular, the trade body says government should be mindful of the risks associated with local variations in licensing and regulations, and the potential impact on the ability of lenders and landlords to meet growing demand from tenants.
The CML also said the government should consider whether tax incentives for landlords, or measures used successfully in other countries, could encourage greater provision of private rented accommodation to meet tenant demand. In Germany, France and the USA, for example, depreciation and rental losses can be offset by landlords against income. Elsewhere, the rate of capital gains tax declines the longer landlords hold on to their property.
However, any proposed changes in taxation or regulation of the sector must be considered carefully to avoid unintended negative consequences for the private rented sector, the CML said.
