Why I am one of the many landlords thinking of leaving the business

The rental market is stretched to breaking point, with a lack of stock, tax hikes and increased competition for places.

Government figures show that 25% of households renting privately are in receipt of housing benefits, which reduces supply for private renters who are struggling to save and pay rent.

Landlords are also leaving the market with the number selling up rising by nearly 13% in four months, Paste BN has learned.

Sean Gillespie, a landlord in Hull, shares his views on the current crisis.

I have been a full-time landlord since 2007. Myself and my partner self-manage a portfolio of around 50 properties which is very demanding, and at the same time very rewarding. We are fortunate to have good, loyal, long term tenants and we try to go the extra mile for people.

But recently things have become more and more difficult for my business and we are now considering selling our portfolio. I am just one of many landlords who have either left the business or is considering doing so, with government legislation, particularly something called Section 24, being the main driver to landlords exiting the market.

Section 24 is a tax which was introduced by then-chancellor George Osborne in 2015. It means that landlords are no longer allowed to offset any of their financial costs against tax. So instead of being taxed on our profits, we're now taxed on our turnover. So we are actually taxed on money that we don't have.

For example, if we received £600 a month in rent and paid a mortgage and additional costs of £600 a month, you still need to pay tax of, on average, 40% on the full £600. Despite the fact that you receive no income. We are now being taxed on the money we give the bank!

Section 24 is also known as the "tenant tax" because what it is actually doing is contributing to many landlords deciding to sell up, leading to a shortage of rental properties - and an inevitable increase in rental costs. Hence the "tenant tax" moniker.

I recently advertised a three-bed terraced house at £625pcm and had 80 applications in three days. It's madness! Almost all of the applicants said the reason they were moving was because their landlord was selling up.

What other business can you not offset your costs? And being a landlord is a business - a business where we provide homes to people. So if the business is no longer viable people will stop doing it. Which is why landlords are leaving the market and why there are now less homes available for people to rent. We are seeing a real crisis in the private rental sector both for landlords and tenants.

'Misconceptions about landlords'

There's a misconception about the business of being a landlord - that we have our pillows stuffed with dollars. That is not the reality. The majority of us, run our businesses ethically and we keep rents low. We look after our tenants and make sure repairs are done on time.

There are a lot of good landlords and lots of very bad ones too. That is the same with tenants.

Most of us care about the people we rent our houses to. We don't want to put their rents up and we don't want to sell their homes either, but we are being forced to. We have mortgages to pay.

The costs of running my own portfolio have tripled since January. In some cases, our costs to rent out a property are more than we're receiving i