The London Property News opinion piece.
A mass landlord exodus is looming over Britain’s rental market, and it should worry anyone with a stake in the property sector. Although Labour has been in power for less than half a year, the judgement from the buy-to-let community is already harsh: one third of landlords are now looking to sell some or all of their rental properties, according to the latest English Private Landlord Survey
It is no great mystery why so many are deciding to exit. Just under two-thirds blame “recent legislative changes” for their decision.
These regulatory shifts are arriving at a time when landlords—often portrayed as the villains of the housing market—are already grappling with rising costs and diminishing returns.
A growing but vulnerable sector
Until now, the landlord population has been on the rise, increasing by 42% from around 360,000 six years ago to just over 500,000 in 2024. However, the reception to Sir Keir Starmer’s agenda suggests this growth may soon stall.
Far from the stereotype of wealthy magnates, many landlords rely on rental income to supplement modest earnings.
HM Revenue and Customs (HMRC) data shows average property income stood at just £16,700 in 2022-23, down 10.8% in real terms since 2018.
Nearly half of landlords earned less than £25,000 in 2024, excluding rental income. Yet their dependence on these rents has grown significantly—what once accounted for 42% of their total income six years ago now represents half.
This is no easy profit centre, but a lifeline that is increasingly threatened by legislative changes and policy shifts.
Budget stamp duty and policy change
Six years ago, 15.6% of landlords planned to reduce their holdings or leave the sector entirely within two years. Today, that figure has doubled to 31.4%, with the number of landlords abandoning the sector quadrupling from under 20,000 to above 80,000.
“Recent legislative changes” rank as the top reason for this exodus (65.6%). And the changes are striking indeed. Chancellor Rachel Reeves’s maiden Budget hiked stamp duty on second homes and buy-to-lets from 3% to 5% overnight, increasing entry costs for potential landlords.
The forthcoming Renters’ Rights Bill will end fixed-term tenancies, delay evictions of non-paying tenants for up to three months, and mandate the publication of a single “asking rent”—effectively banning the competitive bidding process.
Landlords also dread the “forthcoming legislative changes” identified by 43.9%. Energy Secretary Ed Miliband’s plan to ban letting properties that fail to meet stringent energy efficiency standards by 2030 could saddle owners with £10,000-plus in improvement costs.
Most landlords finance their property with a loan
Most landlords—over three-quarters—financed their first property with some form of loan, leaving them vulnerable to rising interest payments. The average borrowed amount grew from £364,876 five years ago to just under half a million now, with the proportion owing less than £100,000 halving from 28.8% to 15.3%.
Little surprise, then, that “financial reasons” are increasingly prompting landlords to consider selling, cited by a third of them in 2024 compared to 22.1% in 2021.
These pressures are not a product of a weakening market—in fact, fewer cite “market reasons” than before. Instead, it is the accumulation of policy decisions and rising costs that threaten the stability of Britain’s rental sector.
If landlords continue to exit, supply will fall and choice will narrow, potentially raising costs for tenants and dampening investor confidence. The once flourishing landlord population could dwindle, leaving a leaner and more uncertain environment for both renters and investors.
The data points to a transformative moment in British property. The landlord exodus may reshape the rental landscape, affecting everyone from tenants seeking affordable homes to investors counting on stable returns.
Unless policymakers reassess the consequences of these legislative burdens, the future may see fewer landlords, tighter supply, and an increasingly complex and costly property market.