A forthcoming tax hike for landlords had been blamed for a majority of planned rent increases, according to the National Residential Landlords Association (NRLA).
In November’s Autumn Budget last year, chancellor Rachel Reeves announced plans to increase income tax on rental income by 2% from 2027.
A Pegasus Insights poll of 837 NRLA members found that, of the landlords planning to increase rents, 65% cite tax increases as a key factor in their decision.
This percentage is second only to the 68% of landlords who point to general increased costs as why they were planning to increase rents.
When it comes to market conditions more broadly, 61% of landlords said tenant demand was still strong.
In spite of this, 24% said they had sold property over the previous 12 months, compared with just 5% who said they had purchased properties during the same period.
Consequently, the gap between those saying they have sold property, and those saying they have purchased any is over twice the level it was at the start of 2024 (eight points).
“This research should be a wake-up call to the government,” said Ben Beadle, CEO at the NRLA.
“Hiking taxes on rented housing will lead to higher rents.
“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.”
