Autumn Budget 2025 – Landlord Reactions
In somewhat good news for landlords, Chancellor Rachel Reeves decided against extending National Insurance to rental income in the Autumn Budget.
However, the Office for Budget Responsibility (OBR) warns that landlords will still be worse off under this Budget.
While National Insurance on rental income was not introduced, the Budget did raise tax rates on dividends, property, and savings income by 2 percentage points, which will increase the tax landlords pay on rental income and raise an estimated £500 million a year.
Successive eroding of private landlord returns will likely reduce the supply of rental property
In an embarrassing turn for the government, the OBR leaked key measures of the Budget, which it described as a “technical error,” while Ms Reeves blamed the OBR for the “serious error.”
The OBR document said: “The measures announced in this Budget reduce returns to private landlords, following various measures over the past 10 years that have also reduced returns.
“This successive eroding of private landlord returns will likely reduce the supply of rental property over the longer run, risking a steady, long-term rise in rents if demand outstrips supply.”
The OBR also mentioned changes to mortgage interest relief, the stamp duty land tax surcharge and capital gains tax allowances, as well as the introduction of the Renters’ Rights Act.
Rachel Reeves blames landlords
Industry experts have welcomed the Chancellor’s decision not to extend National Insurance on rental income.
Critics had warned that such a move could trigger property sell-offs and worsen the housing crisis for renters by pushing up rents.
While the Chancellor chose not to proceed with this change, the Autumn Budget still proved to be controversial for landlords.
Ms Reeves addressed fairness in the tax system, saying that a landlord with an income of £25,000 would pay nearly £1,200 less in tax than a tenant with the same salary because no National Insurance is charged on property, dividends, or savings income.
She said: “It’s not fair that the tax system treats different types of income so differently, and so I will increase the basic rate and higher rate on property, savings, and dividend income by 2 percentage points, and the additional rate on property and savings by 2 percentage points.”
Other measures in the Budget include:
The Freezing of personal tax thresholds for an additional three years from 2028-29
There will be a new High Value Council Tax surcharge of £2,500 on properties over £2m and a surcharge of £7,500 on properties valued over £5m
The two-child benefit cap will be abolished
The Conservatives’ ECO scheme surcharge on energy bills will be scrapped, saving the average household £150 per annum.
The OBR’s inflation forecast has reduced next year’s predicted inflation by 0.4% due to the affordability measures introduced in this Budget. This should increase pressure on the Bank of England to further bring down the Bank Base Rate.
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Industry reactions to the "Mansion Tax"
Member Since March 2024 - Comments: 281
11:51 AM, 30th November 2025, About 5 months ago
Reply to the comment left by Adamufc1 at 30/11/2025 – 09:57
What the government and some onlookers don’t realise is that even though many properties will remain in the PRS when sold by existing landlords – the new owners have little choice but to run them at maximum possible rents to make their acquisition worthwhile. I generally ran my family lets around 10% behind market and my student HMOs were always a few pounds a room behind what I could have perhaps achieved as it help keep good tenants happy.
I didn’t have to pay ridiculous SDLT premiums to buy them and had a good run before the iniquitous S24 came in by which time I was nearly out.
My last house is like yours, £550 pcm against at least £100 more at current market. Great tenants of 20 plus years – was going to go to £575 but it will be £585 to cover the extra 2% tax. I don’t even keep it for sound business reasons and it certainly won’t be re-let by me.
Member Since June 2013 - Comments: 585
10:27 AM, 2nd December 2025, About 5 months ago
Reply to the comment left by Mark Ripley at 17:54
“Can i respectfully ask – why do others remain? It’s a fools game isn’t it?“
Because some are building their portfolios to the 45 level like you and are 30 years younger . They are not exhaustive or weary but full of enthusiasm about what lies ahead . Yes its a tougher journey these days that’s is clear . But if they get to only 50% of what you have admirably achieved they too will still be financially free surely. The new rules do not phase them they just deal with it
In 30 years prices will no doubt have doubled again and leveraging at 75% they will then sell up like you have done and sail into the sunset and good luck to you . If you had chosen to stay in the game you could have given them all to a letting agent and probably could still employ a PA to oversee them so your input is just signing the odd document from you from time to time . ( Lets say a weeks worth in a year ) I agree it could be seen as a weight around the neck for your successors. Mine don’t fancy it either . So I have 100K life insurance in trust so the first call they will do on my passing is to ring the chosen specialist to dismantle it all if that is what they want . They just say – Here is 100K – Sort it please . If your 45 were worth say 100K a piece that’s 4.5 mil + say very conservatively 100K net yield pa . If you had kept them then you or they in 30 years would have an extra 4.5 mil + 3 million income . The reasons therefore for staying in the game in my view are exactly the same reasons as you ( and I ) started . Money and financial freedom for myself and then my kids
Member Since February 2023 - Comments: 87
12:17 PM, 8th December 2025, About 5 months ago
It’s a shame these lowlifes got in. They have nothing to offer the real people paying all these taxes and paying for all these people pretending to be fleeing from something but really nothing and just coming here (because our government is asking them to come) and for them to take advantage of our generosity which isn’t extended to us. All they seem to be worried about is making sure these young men coming in on boats are made comfortable, left to roam the streets, getting free care and warm places to stay whilst our homeless are left on the streets. They are getting cabs to medical appointments paid for at our expense whilst our OAPs like my mum and mum-in-law have to get public transport sometimes 3 times a week to go to hospital, one with cancer and the other with walking difficulties and other ailments. I’m sick to death of paying for people who will never contribute anything to this country but instead will take take take and we will give give give but our own people and needs will be shunned. Shame on this govt.