With the number of homes coming up to let in short supply, Propertymark is calling on the next government to reconsider the way landlords are taxed in a bid to incentivise new investment in the buy-to-let sector.

Demand for privately rented accommodation continues to grow, but fresh data from Rightmove shows an alarming fall in the number of available properties to rent, as more tenants look to renew their existing tenancies rather than move home, adding to the widening supply-demand imbalance in the PRS.

Nathan Emerson, CEO of Propertymark, said: “Propertymark has long argued that the private rental sector needs more houses to stabilise rental prices, but there is a myriad of other factors that can contribute towards making the market more attractive for both investors and tenants.”

The tax relief changes for buy-to-let landlords over the past few years deterred many investors from investing in the private rented sector, owing to a sharp fall in net rental returns, but the real losers have been private tenants.

With many landlords having their profits wiped out, the majority of those who have continued to invest in the private rented sector have been left with little alternative but to recoup their losses through high rents, with tenants paying the price of the government’s tax-grab.

Emerson added: “With a general election coming this week, Propertymark would like to see the next government reform the tax system so that more investors can be persuaded to invest in the private rental sector and lower rents for tenants in the long-term.

“Whilst we support a greater supply of houses, there has to be a sensible deliverable programme mindful of protecting the green belt wherever possible. It would also be wise for them to avoid rent controls which have had a devastating effect on the private rental sector in Scotland.”