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More landlords in Cardiff are letting out their properties as short-term holiday lets, making them no longer available for long term renting following UK Government tax changes.
The Residential Landlords Association’s (RLA) research lab, PEARL, has found that the number of Airbnb listings have increased by a massive 259 per cent in Cardiff alone in comparison to last year.
This suggests that almost one in five homes to rent in Cardiff are now being offered through holiday websites such as Airbnb.
Previous research from RLA PEARL has found that of those landlords now offering short-term lets, over 1 in 3 were doing so because of tax increases on landlords. This includes a reduction in tax relief available on mortgage interest and private landlords being taxed on their income rather than their profit, unlike any other business. These changes do not apply to those renting properties as short term lets.
One landlord who has made the move to holiday lets commented: “I didn’t want to do this, but the tax changes have forced me down this route. Selling is not an option due to CGT, and this iniquitous tax which is effectively retrospective is unjust in that my buy to lets are a business, just like any other. There will be less properties available to rent as a result of this tax.”
The RLA is calling on the UK Government to scrap the changes to mortgage interest relief which are hitting the majority of landlords providing good housing and who Wales needs to encourage to invest in more homes to rent.
RLA Vice-chair and Director for Wales, Douglas Haig, said:
“With the tax changes incentivising the use of homes as short-term holiday lets it is tenants who will suffer as fewer properties are available for them rent for the long term. The Government wants longer term security for tenants, especially families, and landlords support this, but they need to change their tax policy to achieve it.
- The RLA represents over 50,000 private sector residential landlords in England and Wales. The RLA provides support and advice to members, and seek to raise standards in the PRS through our code of conduct, training, accreditation and the provision of guidance and updates on legislation affecting the sector.
- Further information about the RLA can be found at http://www.rla.org.uk/ or by following it on twitter @RLA_News.
- The RLA Private renting Evidence, Analysis and Research Lab (PEARL) is a research-based policy exchange for the private rented sector. It provides analysis and research on the economic, social and political issues facing the sector. Further information about RLA PEARL can be found at https://research.rla.org.uk or by following it on twitter @RLA_PEARL.
- RLA PEARL’s research findings used Airbnb data for Cardiff from Airdna. The analysis identified that rental growth on Airbnb grew by 259% in 2017 compared to 2016. With 5,428 rentals present in 2017. Using data provided by Rent Smart Wales to the RLA, which identified 29,236 rental properties registered. RLA PEARL estimates that nearly 1-in-5 rental properties to rent are now available on Airbnb.
- RLA PEARL’s previous research on Airbnb that identified 34% of landlords moved over to short-term lets due to the Mortgage Interest Relief changes, can be accessed here: https://research.rla.org.uk/report/long-term-lets-short-term-lets-airbnb-new-buy-to-let/