Tenants will struggle if landlords opt for rent hikes to cover the 3% stamp duty surcharge and upcoming changes to mortgage tax relief, a report from property classifieds site The House Shop has found.
A YouGov survey of over 1000 renters revealed that 42% of private renters would not be able to cope with a 5% increase.
Nick Marr, co-founder of The House Shop, said: “There is a ticking time bomb in the private rental sector and with the number of people renting from private landlords already at a 30 year high – we could quickly find ourselves in a very precarious position with wide-ranging consequences for both tenants and landlords up and down the country.”
Sian Berry, a Green Party politician and member of the London Assembly, wants London Mayor Sadiq Khan to take decisive action to control rents.
She said: “The Mayor needs to do much more at a national level – go out and campaign, to tell the government we need rent controls.
“Rail fares are capped at inflation at the moment by government and I don’t see why the London Mayor shouldn’t have the power to do the same for the homes we live in.”
Dan Wilson Craw, policy manager at the Generation Rent charity, added: “Rents are already taking a huge bite out of tenants’ incomes, so any attempts to raise them further will be met with resistance.
“With only a third of privately rented properties mortgaged, tenants should be prepared to negotiate hard on any attempts to raise rent, and remember that there are many landlords out there who won’t be affected by the tax changes.”