Sean Gillespie, who manages around 50 properties, tells Sky News an 'unpredictable and volatile' market has created a situation that is 'unsustainable' for landlords.
For example, if we received £600 a month in rent and paid a mortgage and additional costs of £600 a month, you still need to pay tax of, on average, 40% on the full £600. Despite the fact that you receive no income. We are now being taxed on the money we give the bank!
Section 24 is also known as the"tenant tax" because what it is actually doing is contributing to many landlords deciding to sell up, leading to a shortage of rental properties - and an inevitable increase in rental costs. Hence the"tenant tax" moniker.I recently advertised a three-bed terraced house at £625pcm and had 80 applications in three days. It's madness! Almost all of the applicants said the reason they were moving was because their landlord was selling up.
What other business can you not offset your costs? And being a landlord is a business - a business where we provide homes to people. So if the business is no longer viable people will stop doing it. Which is why landlords are leaving the market and why there are now less homes available for people to rent. We are seeing a real crisis in the private rental sector both for landlords and tenants.
The costs of running my own portfolio have tripled since January. In some cases, our costs to rent out a property are more than we're receiving in rent. If landlords don't make any money, then they can't run a business, can't provide housing and, can't repair houses. We have been demonised particularly by pressure groups like Shelter and Generation Rent who have successfully lobbied the government. But they have made things worse and have indirectly shot renters in the foot.
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