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If they're renting the second property they won't be liable for CGT on their primary property when they sell it anyway since it's not an owned second property. And in this situation they can't expense their primary home mortgage interest anyway, only the rent.

If the other property was owned the expenses used pay the mortgage interest only, not the capital repayment, but yes that was still a nice bonus and was often abused. But it was capped at £24k a year, that's unlikely to cover the interest payments for a 5 bedroom Notting Hill town house. £2k a month interest payment at current interest rates is about £850k of loan.

This all changed in 2010 and now mortgage interest is not paid, only rent. http://www.bbc.co.uk/news/uk-politics-26952462

Under the new system, MPs were allowed to claim a maximum of £1,450 a month to rent - not buy - a second home. Mortgage assistance was thrown out.

The CGT avoiding loophole (flipping) was closed in April last year: http://www.theguardian.com/money/2015/jan/29/sell-second-home-capital-gains-tax

Now when selling a house the CGT is calculated on a proportional basis for how much time it was nominated as a primary home and how much it was a secondary home.

https://www.gov.uk/tax-relief-selling-home/y/yes/no/no/no

Example: You sell your home and make a gain of £100,000.

You owned the property for 20 years but you lived in another home for
5 (25% of the time). The time you lived away wasn’t during the last 18
months or another period that qualified for relief. This means the
amount you get relief on is reduced by 25% (25% of £100,000, which is
£25,000).

You get relief on £75,000.

Since the gain on a larger home will likely be larger than the gain on the smaller home it's no longer immediately advantageous to nominate the smaller home as primary as it makes for a larger CGT bill when the larger home is eventually sold.