Letter: Rent reforms to benefit landlords in capital, but will hit county hard

But most agree that tax breaks have given landlords an easy ride and reform is necessary. It is these tax breaks on rental income that are planned. The quoted objective is to put more rental property into private ownership. The question is how will this effect Shropshire?

The 2011 census consisted of 23.4 million households of which 4.2 million (17.9 per cent) were privately rented. Since then the percentage of renters has risen and is expected to reach 25 per cent of the population and 50 per cent of those under 40.

As is usually the case the rental property market in London is very different from that in the rest of the country.

In the regions the capital value of property has been virtually static for some years while in London gains have been significant. The London landlord is after this capital gain and as rent is a factor it is not nearly as significant as it is in Shropshire. It therefore follows that the proposed reduction of tax benefits on rental income will hit Shropshire harder.

It is the case that many Shropshire landlords have already offloaded portfolios when the capital gain allowance period on second properties was reduced from three years to 18 months.

If your business plan includes profit from renovation this leaves you with a lot less time before having to sell or rent without penalty and therefore leases of six months or a year are a problem.

Right now there is a shortage of rentable property in the county and this will hit those who rent while saving to buy.

By shortage I mean agents with no rentable properties on their books.

The historically large rental surplus in London has largely dried up which actually benefits landlords because the void period where a property waits to be rented has all but disappeared so in actuality by taxing property the Government has increased the return to the London landlord.

A regional centric policy would hit the capital gain and not the income ensuring supply in the provinces and income from the massively inflated London market. A friend's first property was purchased for £30,000 in 1989. He was well pleased to sell at £95,000 a few years later. It's now worth £900,000 and it's in a bad area.

I would suggest the EU move some of their considerable resources to "micro managing" countries like Greece and regions like Shropshire. This would be done by understanding exactly what is going on in small areas and taking a view on how EU and national policy effects those areas.

Robin Lloyd

Ellesmere