Higher Interest Rates and Tax Changes Hammer Small Landlords (2)

Buying a rental house has long been a popular way for regular people to build wealth. But for landlords in two countries on opposite sides of the globe, the math isn’t working anymore.

With higher borrowing costs cooling real estate markets globally, a change in government policy is an added burden for mom-and-pop landlords in the UK and New Zealand. Both countries, seeking to help first-time buyers afford properties, have curtailed a tax break that allowed mortgage interest to be deducted from rental income before owners pay tax on it.

As the tax change collides with higher mortgage rates, landlords are scaling back, or even liquidating, their real estate investments. ...