Julie James MS, the Welsh Minister for Climate Change, has expressed her support for revising the tax regime applied to the private rental sector.
During the unveiling of the National Residential Landlords Association’s (NRLA) ‘State of the Welsh Private Rented Sector’ report, James stated her openness to suggestions on how to use the tax system to encourage the provision of long-term rental homes.
The report’s findings reveal that in the first quarter of 2023, 76% of landlords in Wales noticed an increased demand for rental properties. However, despite this robust demand, nearly half, or 48%, have plans to reduce the number of properties they let, posing a serious issue for renters seeking accommodation.
To address this supply crunch, the NRLA has requested the Welsh government exempt additional home purchases intended for long-term renting from the 4% Land Transaction Tax levied on such properties.
At the event, the Minister voiced her interest in exploring how to level the playing field for the private rented sector regarding the Land Transaction Tax.
Moreover, James has endorsed NRLA’s plea for improved data about the state of the private rented sector in Wales. The NRLA report pointedly highlighted the shortage of comprehensive, up-to-date, and official data on the sector’s size, the types of properties it comprises, and its resident demographics.
In agreement with this, James acknowledged the government’s need to enhance its data to make informed decisions impacting the rental market. She also supported NRLA’s proposal for a Welsh Housing Survey, subject to the government’s completion of a business case.
Ben Beadle, Chief Executive of the National Residential Landlords Association, welcomed the Minister’s statements, saying, “Wales needs a strong and vibrant rented sector. We welcome the Minister’s openness to look at how the tax system can support the provision of homes tenants need.”
He added, “It is welcome too that the minister has agreed in principle with the NRLA’s call for a Welsh Housing Survey. Too often good decisions have been hampered by a lack of robust data on the state of the rental market. We will continue to work with the Government to ensure policy is rooted in evidence and what works for responsible landlords and tenants.”
The report was launched at an event presided over by Mike Hedges MS at the Senedd, featuring key speakers including Julie James MS, Ben Beadle, and Dr Robert Smith from the UK Collaborative Centre for Housing Evidence.