Taxpayers are funding private landlords to the tune of just over £1,000 per household.
Generation Rent claims that landlords are getting £26.7bn a year in taxpayers’ subsidies. It says the sum is made up of £9.3bn housing benefit; £1.69bn tax relief on ‘wear and tear’; £6.63bn that landlords do not have to pay on mortgage interest payments; and £9.06bn of tax that landlords do not pay on annual capital gains.
The campaign group calculates that landlords, who house 4.75m households in the UK, are earning £77.7bn a year but pay only £8.9bn in tax.
The earnings figure consists of £42.3bn in rent and £35.4bn in rising house prices.
Generation Rent is calling for an additional landlord levy of 22% on rental income, which it said would recoup the £9.3bn housing benefit bill and which it says should be used to fund 90,000 new council houses.
Alex Hilton of Generation Rent said: “While renters have borne the brunt of austerity, landlords have enjoyed their own little economy the size of Morocco’s supported by subsidies from the UK taxpayer that could be better used fixing the housing crisis.
“It’s time landlords started paying more of their fair share so first-time buyers could have a level playing field and the government could have the resources to build more social housing.”
* A surge in buy-to-let took the number of investors up to 1.63m in the tax year 2012/2013. That was 120,000 more than in the previous tax year, London agent Ludlow Thompson has said.
The firm calculates that landlords’ net income – rental income minus all costs – reached £13.1bn in 2012/13, 8% higher than the £12.1bn net income in 2011/12.
Comments (13)
It’s so sad that this outrageous propaganda gets so much political attention and is then regurgitated as fact. The facts are that we, (as do the majority of Landlords) have tenants in brand new or refurbished properties that have not had their rent increased for more than 5 years. The reason being that we want long term relationships with our tenants and believe it or not we want them to be happy. We have of course been taken advantage of by tenants, leaving owing substantial rent and damages but we don’t assume all tenants are like this. We don’t have benefits tenants so haven’t ‘burdened’ the country by taking housing benefits. We do however have to pay extra taxes like full council tax for every day a property is empty, (no single person discount etc even though no-one is living at the property so no rubbish collection or other council services required), this means that the more work that we do to refurbish a property between tenancies, the more we are taxed. We are also going to have selective licencing imposed which means £500 per property let fee and attempts to make us responsible and liable for a tenants actions. But generation rent don’t think that Landlords should be able to claim legitimate business expenses to provide the quality homes they require? I know I’m not alone in becoming a little frightened by the tone and rhetoric of organisations like Generation Rent, Shelter and the labour party. I know I’m only a small voice but these organisations should know that I have already placed one vacant property on the market to sell and I’m trying to sell two tenanted properties because I’m really worried about the direction this industry is taking. I’ve taken the decision to start slowly offloading my properties before the mass exodus of landlords flood the market with their portfolios. Anyone interested in buying tenanted properties in South Yorkshire with nice tenants, (full tenant vetting history, rental payment history and maintenance history’s available) please get in touch.
Jesus H Christ! What planet are these blithering idiots on? £9.3 billion in Housing Benefit paid to landlords? No it isn’t, it’s paid to the TENANTS for their housing. If it wasn’t then paid to the private landlord, it’d be paid to the local authority or housing association instead.
£1.69 billion on tax relief for ‘wear & tear’? Show me a business that doesn’t have.
£6.3bn for mortgage interest payments? Again show me a business that doesn’t offset it’s loan & mortgage interest in it’s accounts.
£9bn in capital gains? Yet again, show me a business that doesn’t have some sort of capital gains allowance.
I just wish these idiots would join the real world. In the mean time, I’ll continue to take the risk of putting my own (already taxed) income into buying property, along with a mortgage in the hope on renting it at a reasonable return in the knowledge that should the tenant not pay his rent, I could lose the property and my own money in it. And, like nearly every other private landlord, I’ll maintain it to a higher standard than the local authority. And renovate/redecorate for each new tenant.
How about all the feckless who decide not to work and are handed housing benefits by the government? – Its the government and work shy costing us money not the landlords!
From memory, the cost to the taxpayer of top-up benefits paid to fully employed people who qualify FAR exceeds dole handouts paid to workshy dole scroungers. By a considerable amount. The problem is a lack of housing and 50 years of absolutely NO housing policy at all while making Britain the best place to live and work in Europe – what the h3ll did everyone expect?
I really don’t see a problem with renting, i rented for years before buying, i chose to stay out of London for some time and commute to have a better place, generation rent is nothing new. If the Government wants to help it should simply limit the amount of new stock sold overseas and left vacant in London and offer people housed in London who don’t work incentives to move away from London and make room for tax payers. This would free up housing and alleviate the inadequate transport system.
Where on earth do these people get their figures from? Bob the Builder?
One has to worry about this mentality. If they look back at the 1970’s and early ’80’s it was “Generation NO RENT” rents were artificially low, property is poor condition as it was not possible to maintain it at the rents paid, and NO ONE could rent as property was removed from the market due to rent control. There was lack of mobility as people COULD NOT move for their jobs as they were unable to rent AT ANY PRICE!!!!!!! The Private rented sector is being used due to INADEQUATE SOCIAL HOUSING AND POLITICAL FAILURE TO PROVIDE COUNCIL HOUSING coupled with TOO HIGH A DEMAND DUE TO financial migration into this country without providing the necessary infrastructure. Generation Rent need to look at the whole picture if they are to be credible.
Well of course ‘Property is theft’ and the only safe custodian of property/housing is Government because they always make such a good job of providing it and maintaining it cheaply, effectively and efficiently. Power to the people as Foxy Smith said when addressing the Tooting Popular Front. (probably showing my age there but…)
The more I read and with the onset of the General Election it appears our culture is moving towards anti-private landlord, this will only lead to landlords leaving the industry and making the choice of suitable alternative accommodation for tenants even more restrictive. If this should happen and with the likely hood of an interest rates rise in the near future, the sector will be disrupted and not for the better. Would the last landlord to leave the sector please turn out the light. The future is not looking bright for the landlord or his letting agent. Selling agents prepare to be busy.
Nor will it look good for tenants in the longer term – government will not be able to step in to replace the loss of property in the PRS! (particularly government has a short-sighted 5 year view and pressure to grab votes!
Good point Yorkshire agent, As well as wanting to get rid of fees what do they think landlords will do when interest rates rise.
Landlords having to potentially cover the costs of tenants fees, coupled with an interest rate rise will send rents through the roof!
Methinks these people ought to consider their comments first – with the acute lack of house building by both the recent governments, a tax on private landlords’ income will just hike prices up even further, encourage some landlords to sell up thus making the shortage worse still and the only losers will be those stuck in rental property. Don’t get me wrong – my daughter is part of ‘generation rent’ but it’s not the agents fault, there’s simply not enough property to go round.
Seems everyone wants to fork the private landlords at the moment, noone seems to consider how forked they would be without them