Rents continue rising as summer price spike looms

Or course rents are going up: The government is continuing to drive rents up by driving out competition and exacerbating this with some of the elements of the Renters Rights Bill. The labour government is driving rents up, partly because it doesn’t have the competence to understand anything to do with business or economics, partly because it doesn’t learn the lessons of history and also partly because it isn’t honest about the real effect of its policies.

The telegraph just reported that 1 in 3 hospitality businesses are now losing money because of Rachel Reeves’ tax changes:

https://www.telegraph.co.uk/politics/2025/06/02/one-in-three-hospitality-businesses-losing-money-reeves-tax/

The telegraph also just reported that the government’s changes on tax for farmers will actually cost the government £2 billion.

https://www.telegraph.co.uk/business/2025/06/02/labour-tax-raid-on-farmers-to-cost-treasury-up-to-2bn/

The government doesn’t understand business or the UK economy and it doesn’t understand the UK housing market either. The UK has a history of boom and bust in the housing market. There’s a summary of that here:

https://helmores.com/blog/a-history-lesson-how-the-uk-property-market-went-from-boom-to-bust-in-2008/25549

Ireland also has a history of boom-and-bust and recently changed policies to enable interest payments to be deductible against rents under certain circumstances. There’s a summary of current Irish policy here:

https://www.dentons.com/en/services-and-solutions/international-tax-guide-to-real-estate-investment/ireland-real-estate-tax-guide

[In Ireland] “Interest payable on a loan to purchase, improve or repair a rental property is deductible against rental income subject to certain conditions. If the income is taxed as part of a trade, a deduction is available for interest which is incurred “wholly and exclusively” for the purposes of the trade and “In some cases, income from property rental can be taxed as trading income at a rate of 12.5% for companies.”

For reasons that seem to be to do with ideology and media sound-bites, this labour government consistently implements badly-thought out policies that are poorly targeted and result in a lot of collateral damage. The government needs a sustainable policy on farming and the environment; it needs to spend more on defence and it needs to spend more on energy, even if only to ensure energy security. But it can’t afford it: And it isn’t going to be able to deliver energy security or housing security unless it changes its tax policies; it needs to deliver a boom in energy-efficient housing, without causing a bust, without exporting its renewable energy industry offshore and by empowering its citizens to be involved in the change, without just milking them via the tax system to retain control of them.

It needs a competent government able to understand the economics, learn the lessons of history and balance the short-term, mid-term and long-term view. And yet the labour government persists with the “renters rights bill” when what is needed is a renting reform bill that is fair to both landlords and tenants. And yet the government keeps on driving rents up even when it is pointed out what the real effects of its policies are.

If any tenant had the right to rent ANY property in any EPC band, including bands E and F, but finance costs for energy improvements were tax-deductible and finance costs for the more efficient properties were also tax deductible then we might one day see a boom in housing in the UK that provided both energy security and energy efficiency but didn’t lead to a bust: But this can only happen without having a labour or SNP government that effectively forces tenants to pay for energy efficiency and security, without lying to tenants that this is what the real effect of their policies is.

Being a good landlord providing safe housing is every bit as socially-useful as being a doctor, nurse or train-driver.

Reply to the comment left by Beaver at 02/06/2025 – 12:00
The government will find out how socially useful landlords were when there are few left. Maybe I could retrain as a train driver or even a fireman?

Reply to the comment left by TheMaluka at 02/06/2025 – 13:49
Were you to become a fireman you’d probably have to do some form of on-call work.

Train diver?…. in the wake of Covid, faced with a 25% reduction in passenger numbers they were able to go on strike because they were worried about job security. And then as soon as the new labour government came in they were given £70K per annum, a four day week, and weren’t obliged to come to any agreement to implement any changes that would result in a better passenger experience going forward.

And as a train driver you don’t have to invest any of your own money or take any personal risk to get your ‘job security’ or ‘financial security’. That’s something you have to really work hard for for years as a landlord. Although I suspect some train drivers are also landlords.

So it’s a no-brainer…both are socially useful but you’d be better off becoming a train driver than a landlord any day.

Two years ago I was laughed at by agent asking for £700 pcm for a 2 bed in one of my areas. I actually got £705 forward 2.5 years and rent is now £900 this is market rate. Well done government and RRB still not kicked in yet!