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Fears are growing that Chancellor George Osborne will reduce valuable tax relief for buy-to-let investors in today's Autumn Statement.

Property investment experts have warned this would hit thousands of landlords who rely on tax relief to stay in business.

But it would be popular among potential first-time buyers and appease critics who claimed that buy-to-let investors are unfairly pocketing £5 billion a year in government subsidies.

David Whittaker, managing director of Mortgages for Business, said talk of scrapping buy-to-let subsides had "opened up a can of uncertainty that the Chancellor will need to put a lid on one way or another".

"Thousands of landlords currently rely on the clarity of their tax position to stay in business and provide homes to tenants.

“In terms of funding, buy-to-let mortgages are a commercial product, with the residential property used as security.

"Buy-to-let funding is also treated like a business transaction rather than as a consumer product.

"Any change would need to come with plenty of detail, and would represent a significant change of direction from recent attempts to encourage larger institutional landlords.

"Removing interest as a deductible expense may help to disperse any impending new property bubble but it will have a considerable knock on effect to the supply of privately rented accommodation, which is currently filling a widening gap in the short supply of social housing.”

The Chancellor delivers his statement to the House of Commons from 11.15am.

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