Renters’ Rights Act blamed for shrinking rental supply

Reply to the comment left by LaLo at 04/09/2026 – 12:52
There are a lot of complications around leaseholds that have been there for years. However, there is one thing that freehold/leasehold under labour’s Renters Rights Act can make simpler which is that the freeholder can specify no pets, i.e. if the leaseholder is the landlord the leaseholder doesn’t necessarily have to risk being taken to a tribunal for saying no to a request for a pet if the freeholder excludes them.

We had a potential tenant that wanted to rent our property. He failed the checks but in the old days he could have paid up front. They can’t now . We both lose. What idiots are coming up with this rubbish? They have faultlessly paid their rent through the same agency for over a year for another property before trying to rent ours. They just wanted a bigger place.

Reply to the comment left by Steve Wood at 04/09/2026 – 15:01
Yes, it is idiotic: Banning payment of rent upfront affects retired people with savings but low income and renters from overseas who can’t get guarantors. The ban doesn’t benefit anybody. And being prevented from taking more than the asking rent EVEN if it is offered means that the landlord cannot respond appropriately, for example to tenants who want pets or have some other requirement that could otherwise be accommodated.

Woop woop! Who would have figured this would happen….

Reply to the comment left by Eoin Deane at 04/09/2026 – 15:27
The answer to that question is….any group of people with any experience of business….any junior marketing assistant…anybody who had ever owned a mobile phone, accessed financial services, shopped in a supermarket or spent more than five minutes thinking about where to buy things. Pretty much any grown-up with average intelligence would have figured this would happen.

To be honest the new RRA isn’t what’s making us think of selling, it’s section 24! The government need to re look at this and reintroduce the ability for us to be able to offset financial costs! To have to pay tax on all rental income less running costs is going to start crippling landlords (inc us!) who are coming out of very low fixed mortgages! What other business is there where you can’t do this? None!!

Now HMRC is asking landlords to do tax return every quarter. Landlords has to pay property tax if they introduce. Not surprising many landlords are considering to sell their properties. Buy SPY ETF give more higher return less hassle than investing in the UK properties. Many small landlords will leave the sector. All parties are very hostile to Landlords to get votes from tenants. All UK government become very hostile to investors, entrepreneurs and businesses.

Reply to the comment left by Ashleigh at 04/09/2026 – 15:54
I agree that section 24 is nuts. However, I suspect that AT THE MOMENT what is prompting many landlords to sell is probably the threat of increases to capital gains tax:

https://www.property118.com/renters-hit-hardest-as-landlords-sell-up-ahead-of-potential-capital-gains-tax-hike/

The IFS has also raised the possibility of CGT hikes:

https://ifs.org.uk/news/capital-gains-tax-needs-serious-reform-not-just-more-tweaks

However, these things are of course linked to each other and linked to the RRA: If you are already struggling to cover your costs because you cannot offset your interest against rents and possibly facing a loss because of the increased risks incurred by the RRA, including losing the back-up of no-fault evictions that used to be there to reduce your risk, then there’s an increasing likelihood that you will sell and get out while you still can.

But yes, allowing landlords to offset their finance costs against revenues, just as any small business can, would be one thing that the government could do to reduce the damage that they have done with their RRA. Speculation about rises to CGT also does damage, in just the same way that speculation over labour reducing the 25% drawdown on pensions also damages the pensions industry.

Reply to the comment left by wyn kyaw at 04/09/2026 – 16:26
Yes, there are a number of financial vehicles that give a better return on capital than UK-based residential property. So for example passive (as opposed to active) funds can give a better return:

https://www.moneymagpie.com/investment-articles/passive-investing

The key fact that the extreme-left-wingers currently in power have missed (or are lying to the electorate about) is that on average landlords have never been greedy. The reason that people have invested in residential property is that historically it has been seen as a SAFE investment….not a high-return investment. I know lots of small portfolio landlords and until the prospect of rent-restrictions (a.k.a. rent controls) came along many of them had not raised rents for years. In fact, on this site, I have often seen discussions where large portfolio landlords have tried to encourage small portfolio landlords to raise rents. This does not automatically mean greed…many of the larger landlords have more experience of tenants not paying them, trying for more than a year to get properties back via the courts or of tenants trashing their properties and being unable to recover the costs (other than from other, good tenants).

The fact is that small portfolio landlords have provided CHOICE in the market and COMPETITION. With one stroke, with their Renters Rights Act, labour have eliminated this competition and made many rental properties a high-risk investment. They could limit the damage by allowing landlords to offset interest against rents but some damage will still have already been done.