Buy-to-let sector calls on government to provide tax relief
The Association of Residential Letting Agents (ARLA) is calling on Prime Minister Gordon Brown’s government to offer landlords a new form of tax relief, in order to encourage them to renovate and improve their rental properties. In its bid to convince the government, ARLA referred to a recently conducted survey which found that fully 61 percent of residential landlords in Britain would be willing to invest in significant renovations, if they were offered tax relief as an initiative. Ian Potter, who manages operations at ARLA, observed that it would be unrealistic to expect landlords to spend large amounts of money on renovations in the middle of a recession and in a time when property prices have fallen so dramatically.
Potter also observed that many rental properties in the UK would be in need of renovations, but small landlords—who form the bulk of the buy-to-let sector—are often not in a position to make major investments, as they have loan payments, vacancy and falling property prices to worry about. Government authorities seem to understand the need for improvements in the residential rental sector, but officials have yet to devise a way to encourage landlords to invest. Most properties, however, were built between 50 to 100 years ago, and many of these have not undergone major improvements over the decades. According to Potter’s own statistics, over 30 percent of these properties are in need of refurbishment.