Private rented sector can boost government income by £10 bn – NRLA

Increasing the supply of homes for private rent could significantly bolster the government’s finances, potentially adding £10 billion, according to the National Residential Landlords Association (NRLA).

The NRLA submitted its recommendations to the government ahead of the budget on March 6, amid concerns over a shortage in the rental market. Research indicates that, on average, 11 potential tenants inquire about each available rental property.

Independent analysis conducted by Capital Economics suggests that eliminating the 3% stamp duty levy on additional home purchases could result in approximately 900,000 new privately rented properties nationwide.

Based on the calculations, this move could generate a £10 billion increase in Treasury revenue through heightened income and corporation tax receipts. To put this in perspective, it nearly matches the £11.5 billion allocated for the Affordable Homes Programme for 2021 to 2026.

The NRLA is urging the Chancellor to abolish the Stamp Duty Levy during the upcoming Budget. The levy was introduced in 2016 by then-Chancellor George Osborne, who argued it would prevent landlords from displacing families aspiring to own homes. The landlord group, however, pointed out that this reasoning was challenged by the London School of Economics, which contended that only a minority of landlord sales competed with those from prospective homeowners.

“The Chancellor needs to pull out all the stops to tackle the housing crisis,” said Ben Beadle (pictured), chief executive at the National Residential Landlords Association. “Growing the private rented sector is not only vital if tenant demand is to be met, but it would also provide a substantial boost to Treasury coffers, enabling it to invest in vital public services.

“It makes no sense to discourage investment in desperately needed private rented accommodation. Inaction will only result in more misery for prospective renters.”  

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