Property experts slam Budget tax raid on landlords
2 weeks ago | 25 comments
Government insists property tax rise will have little impact on rents
10:30 AM, 4th November 2026, 6 days ago
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The government claims a two-percentage-point tax rise on property income would have only a small impact on rents.
Chancellor John Healey announced in the Budget that tax rates on property and savings income will increase by a further two percentage points from April 2027, adding to the rise announced by Rachel Reeves last year.
During a debate, Housing Minister Matthew Pennycook claimed the additional increase would have only a small impact on rent prices.
Push rents up higher
Mr Pennycook told the debate: “At the Budget last year, the Office for Budget Responsibility (OBR) assessed that there would be only a small impact on rental prices of 0.2% as a result of the 2 percentage point increase to property rates from April 2027, and we expect the further increase of 2 percentage points announced in the Budget last week to have a comparably small effect.”
However, during the debate, Conservative MP Steve Barclay pointed to the OBR’s assessment of the additional two-percentage-point tax rise, warning that the measure could push rents higher for tenants and reduce the supply of rental properties.
Mr Barclay asked Mr Pennycook: “Does the Minister think the OBR is wrong? If not, does he accept that rents will go up as a result of those measures?”
Small impact on rents
Mr Pennycook continued to claim the additional two-percentage-point increase would have only a small impact on rents, while criticising the Conservatives over their opposition to new housing developments.
He said: “At the Budget last year, the OBR assessed that there would be a small impact of 0.2% on rental prices as a result of that increase, and we expect a similarly small impact from this increase.
“The obvious answer to affordability challenges in the private rented sector, as well as everywhere else, is to build more housing supply.
“That is why it is so disappointing that Opposition Members, despite what those on their front bench say, consistently complain about new housing developments coming forward in their constituencies.”
Tags:
Budget 2026, Landlord Tax, Matthew Pennycook, Office for Budget Responsibility, property and savings income
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Member Since September 2018 - Comments: 3792 - Articles: 5
9:20 AM, 4th November 2026, About 6 days ago
well they, along with all tenants are in for a shock incoming…..
Member Since April 2024 - Comments: 28
9:22 AM, 4th November 2026, About 6 days ago
In April one of mines going up to cover this so I’m assuming it will have e an impact. It’s been 2 years since it was increased and with this happening now it can’t be held any longer. 6.5% it’s going up and that’s not bad with no raises for 2 year
Member Since March 2023 - Comments: 1533
9:34 AM, 4th November 2026, About 6 days ago
Reply to the comment left by Adamufc1 at 04/11/2026 – 09:22
mine haven’t been raised for 2 years I have increased them by 11%, and I am still below the market rent
Member Since June 2015 - Comments: 378
10:45 AM, 4th November 2026, About 6 days ago
Twenty of mine are increasing in January. Nowhere near enough to cover all the cost increases, so 2028 increases are already baked in.
I hadn’t increased several of mine since April 2025 and a few since April 2024. Even with the increases they’re still below market rent but that isn’t especially helpful when the tenants woefully inadequate LHA is frozen. However, the feedback I’ve had is that they were terrified I’d want to sell and they would be forced to pay substantially more if they could even find an alternative tenancy. One even asked if the £50 increase was enough and said she would be happy to pay more if it ment her home was secure. I haven’t actually threatened to sell anyone’s home yet but have made it known I would be very happy if any of them wanted to buy.
Member Since September 2021 - Comments: 2
10:51 AM, 4th November 2026, About 6 days ago
Don’t think increasing tax by 2% will make the slightest impact on this governments 3 trillion (£4000000 interest a day) debt
It’s just them being nasty as usual
Member Since April 2018 - Comments: 710
10:54 AM, 4th November 2026, About 6 days ago
A 4% tax rise would have an impact on rents if I only I could as I can not keep subsidising tenants while this government continues to beats me with a big stick. On top of this we have a database at £65 per property per annum and a rent tribunal.
Member Since May 2018 - Comments: 2674
11:06 AM, 4th November 2026, About 6 days ago
Reply to the comment left by David at 04/11/2026 – 10:54
Plus the other effects of labour’ Renters Rights Act, all of which are inflationary…
Member Since October 2013 - Comments: 1796 - Articles: 3
11:09 AM, 4th November 2026, About 6 days ago
Reply to the comment left by GlanACC at 04/11/2026 – 09:34
Took me 3 years of 9% increases to get back to the market rent. Based on the recent Tribunal stats, landlords are unlikely to be able to increase rents significantly, unless they are below the market rent.
Member Since February 2018 - Comments: 632
11:15 AM, 4th November 2026, About 6 days ago
‘Lies, dammed lies, and statistics”. Correctly described as “2 percentage points” and a further increase of the same, results in an actual aggregate tax increase of 20%
Member Since October 2023 - Comments: 272
11:26 AM, 4th November 2026, About 6 days ago
I’ve already informed my tenants of a rent rise, so the OBR seems to be living in cloud cuckoo land.