Tenants across Banbury should be braced for higher rents as landlords are hit by a tax hike that could force many to sell up, a leading accountant has warned.
A three per cent rise in stamp duty aimed at buy-to-let investors, and which has just come into force, could see many landlords leave the market.
Financial experts warn that if landlords do opt to sell up it could reduce the supply of rental accommodation but push up rents for properties still available.
The alarm has been sounded by Val Buzzard, director of Whitley Stimpson, in High-town Road, and which also has offices in Bicester, High Wycombe and Witney.
She said: “Tax changes have made buy-to-let properties less lucrative for landlords.
“They can no longer claim all their mortgage interest costs against their rental income for tax purposes and they are being hit by the extra three per cent on stamp duty.
She added: “This is pushing some small investors to sell up, and hence taking properties out of the rental market.”
“This knock-on effect means that tenants face higher rents.
“Surveyors are warning that these extra taxes and restrictions on landlords are pushing property owners to sell up, therefore reducing the supply of properties on the rental market.
“Our message to landlords is make sure you are aware of all the changes and if in any doubt contact the experts for help and advice.”
According to figures released by the Royal Institution of Chartered Surveyors (RICS) rents could rise by up to two per cent this year and by as much as 15 per cent by 2023.
The RICS has also warned that renters, buyers and landlords are likely to feel additional pressure on their finances thanks to the recent interest rate rise from the Bank of England.
While the hike leaves the base rate at 0.75 per cent it is still likely to make borrowing costlier at a time of tight margins for landlords, and prospective buyers.