If you’re a Housing Charity …

We believe that the proposed tax change on mortgage interest relief on rented properties is going to hurt your clients badly.

Please take a look at the examples we’ve given of how Landlord’s tax will change (under the Landlords tab). You will see that for many Landlords, providing accommodation to renters will not be a viable option with the tax change. Rents will need to increase and there is already plenty of evidence to say that the increases are being planned. This will undoubtedly lead to higher arrears and evictions.

If rents cannot be increased or will not cover the new tax burden then the Landlords will need to evict anyway in order to sell their properties.

Many Landlords will not be able to sell and with their investments now running at a loss they simply need to wait for them to be repossessed. Again the tenants will need to be evicted.

The Government say only 1 in 5 Landlords will be affected but we think this is ridiculous. However if we say that 1 in 5 will now need to sell some or all of their properties then the consequences are dire. Assuming that they will only, on average, need to dispose of 2 properties each, then this will result in 800,000 tenants being evicted along with their families. It is likely that the first to be evicted will be Local Housing Allowance tenants as it is already problematical for the Landlord to get paid. With budgets being slashed then the situation will be exacerbated.

If each of those 800,000 tenants is a family of 3, then we're talking 2.4 million people made homeless. Unfortunately, as we've indicated elsewhere on the site, the problem may be much worse than that. 1 in 5 is 20% and if we apply the Pareto 80/20 rule then those Landlords that are being affected may well own 80% of the rented housing stock.

This tax change could bring about a housing crisis that makes the current situation look completely fine.

Right now there are more families in bed and breakfast accommodation than any time since the peak of 2008. It will be impossible to find new homes for all these people in a smaller market, and especially when budgets are being slashed.

The Chancellor has said that he is making the change to taxation to put Landlords on a more level footing with owner/occupier buyers, but as the Institute of Financial Studies and Policy Exchange have said, his thinking is flawed. This will not reduce demand for housing.

If he’d really want to put both sides on a more level footing then he should have re-introduced mortgage interest relief for the owner/occupiers.

If you are concerned that the proposed changes are going to bring extreme hardship to an enormous amount of renters, then let’s work together to stop this tax change. Please write to your local MP to ask him/her to support you.