David Whittaker, managing director of Mortgages for Business, has raised his concerns over possible action affecting buy-to-let landlords in tomorrow’s Autumn Statement.
It has been rumoured that George Osborne is considering removing the tax-deductibility of mortgage interest payments for buy to let landlords.
According to one recent report, this would cost landlords between £3 billion and £5 billion per year.
Whittaker (pictured) said: “This has opened up a can of uncertainty that the Chancellor will need to put a lid on one way or another. Thousands of landlords currently rely on the clarity of their tax position to stay in business and provide homes to tenants.
“In terms of funding, buy to let mortgages are a commercial product, whatever the residential property used as security. Buy to let funding is also treated like a business transaction rather than as a consumer product. Any change would need to come with plenty of detail – and would represent a significant change of direction from recent attempts to encourage larger institutional landlords.
“Removing interest as a deductible expense may help to disperse any impending new property bubble but it will have a considerable knock on effect to the supply of privately rented accommodation which is currently filling a widening gap in the short supply of social housing.”
