Propertymark 2023 Spring Budget representation

Concentrating on three core themes to drive the housing sector forward, Propertymark has called on the UK Government to improve welfare to support vulnerable and low waged tenants, provide energy efficiency grants to support landlords and homeowners to achieve Net Zero and repeal Section 24 to reintroduce Mortgage Interest Relief and other tax deductibles for landlords.

Man holding red briefcase

Improving welfare system for vulnerable and low-waged tenants

The cost-of-living crisis has driven many people into poverty and has increased the risk of homelessness. Local authorities are inundated with homelessness requests and housing options are limited for many people. Propertymark has called for the UK Government to peg Local Housing Allowance to the fiftieth percentile. With the pandemic and the cost-of-living crisis adversely impacting the employment opportunities for many young people, we also called for a cessation of the Shared Accommodation Rate.

For many single private renters under 35, the Shared Accommodation Rate (SAR) places a cap on the amount of housing assistance that can be provided through the benefits system. Finally, to reduce the debt for those in receipt of Universal Credit, we have called for the Universal Credit Advance to be converted into a grant from the start of a claim.

Learning lessons from the Green Homes Grant

The Conservative Government pledged £9.2 billion as part of their 2019 election manifesto. So far support for landlords and homeowners has been limited. The UK Government has invested £1.5 bn to decarbonise 130,000 homes in the social sector. However, similar support for renters and homeowners – through the Green Homes Grant – was hampered by bureaucracy and inefficient management. It is imperative that lessons should be learned from the Green Homes Grant and support landlords and homeowners to decarbonise through incentives. 

Increasing the housing supply

One of the biggest challenges for the private rented sector is that the demand far outweighs supply. A chief reason for landlords exiting the market is because of Section 24 and the phasing out of Mortgage Interest Relief. 

The Treasury has made £14.3 billion in Capital Gains Tax (CGT) in the 2020/21 tax year, taking contributions from a total of 323,000 taxpayers with the current rate set at 28% for Buy to Let properties. However, this money can no longer call upon by the UK Government and we have called for them to adopt more sustainable tax measures for landlords. 

We believe a generous estimate of reintroducing Mortgage Interest Relief would cost the UK Government £1bn. However, not only would this increase supply and drive down rents but would be a medium-term commitment to reducing the £30 billion spent annually on housing benefits, which is between £8 and 10 billion more than the Office for Budget Responsibility forecast.