George Osborne has cut mortgage interest relief on buy-to-let homes, in an effort to create a "level playing field" between prospective landlords and those buying their homes to live in.
The chancellor said the relief will be cut to the basic rate of income tax, which currently stands at 20 per cent.
The measure, which will address "unfairnesses in property taxation", will be phased out "gradually" from 2017.
Genevieve Moore, a partner at chartered accountants Blick Rothenberg, slammed the move.
"This is likely to impact many of Britain's workers who have saved hard and invested in property to supplement their retirement. [We] could see a flood of buy to lets being sold as the squeezed middle bow out of the rental market," she said.
However, in good news for Airbnb enthusiasts, though, he also raised the limit on the "rent a room" scheme, which allows landlords to earn money tax-free by letting out furnished accommodation in their home, from £4,000 to £7,500.
Matt Hutchison, director of flat share site SpareRoom.co.uk, said the move had "potentially huge implications" on affordable rented accommodation.
“There are an estimated 19m empty bedrooms in owner-occupied properties in England alone. Freeing up just five per cent of those rooms would accommodate almost a million people – the equivalent of a city the size of Birmingham.