Section 24 policy will bankrupt buy to let and increase homelessness
So I booked in to see Gavin Barwell yesterday in Taunton to raise the issue of Section 24 aka ‘The Tenant Tax.’
There were over 150 people in the room and I got my hand up but sadly we weren’t allowed a lot of time each before he answered; only about 20 people got the chance to speak.
A lettings agent asked him to explain the thought process behind section 24 and increased stamp duty which will only increase rents when the government are looking to solve the housing crisis , so I followed it by standing up and telling him I was a living example of what section 24 is going to do.
I told him I’ve been a landlord for 12 years I had bought poor housing and renovated it I homed 55 people in 34 units, I had not raised rents in many years.
I told him in four years he will make me bankrupt. I asked him what would happen to my tenants. I told him I have put my portfolio up for sale and nobody is looking to buy it for residential.
I explained the people who have shown interest are looking for yield and are looking to turn my houses into HMOs displacing those families. And that with my flats they are looking at how much they can increase rent when they have bought from me. I decided as I did not have long to speak just to give him a real life example of the carnage section 24 is going to cause.
He answered that the Chancellor George Osborne had bought in section 24 because he was warned by the banks that the buy to let market was creating a bubble that would burst so they had to calm the buy to let market. He also said it was to level the playing field with homeowners, and that it does not affect many landlords (that old chestnut!!).
At that point I got back up without a microphone and asked him was one landlord and 55 people potentially made homeless not enough?
He answered that they have to look at the bigger picture. He did say it’s being phased in over four years and they will monitor its affect as it goes. So my only glimmer of hope is that all landlords make the tenants aware and publicise the rent increases and evictions due to section 24.
It is clear private landlords mean nothing to them and it’s all about building new homes and creating affordable homes. Buy to let landlords are seen as insignificant. I am only just coming down from the experience it was very daunting and I was pushed very far out of my comfort zone !!
I’m sorry I didn’t get to ask all the questions people put forward HERE and via facebook but I just would not have been given the time.