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17/12/25 3:30 pm
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Two thirds of landlords planning to increase rents say property tax rises are a key factor in their decision.
The NRLA believes its poll of 800 members supports the Office for Budget Responsibility’s warning that a 2% rise in income tax rates on rental income in 2027 will lead to higher rents. The landlord body has previously said that this could see rents rise by £20-25 per month, and more than £40 per month in London.
Of those who plan to increase rents, 65% cite the tax increase as a key factor in their decision, second only to the 68% who needed to cover the increased cost of running a property.
With the government due to end no fault evictions from 1st May, landlords say backlogs in the court system for repossessing properties is their main concern, with 91% either very concerned or slightly concerned about court wait times. The findings come as government data shows it takes an average of more than seven months for the courts to process and enforce possession cases brought to it under the system replacing Section 21 - the longest it has been since the start of 2022.
When it comes to broader market conditions, 61% of landlords said tenant demand was now strong. However, despite this, 24% had sold property during the previous 12 months, compared with just 5% who had bought properties during the same period.
At 19 percentage points, the gap between those who have sold property, and those who have bought any, is more than twice the level it was at the start of 2024 (eight points). Of those who have sold property in the last year, 27% did so with existing tenants in situ.
Chief executive Ben Beadle believes this research should be a wake-up call to the government. “Hiking taxes on rented housing will lead to higher rents,” he says. “It’s not exactly clear how this approach will address the cost-of-living crisis ministers now say is the government’s number one priority.”
He adds: “Ministers have pledged to ensure the justice system is ready to process cases where landlords have good reason. However, as of yet, they have failed to explain what ready means.”
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