Tax changes prompt landlord sale plans

More than half of landlords in a post-Budget poll say they plan to sell some or all of their properties within the next 12 months in response to Labour’s tax changes.

Research by Pegasus Insight found that 52% of the 168 National Residential Landlords Association members surveyed intended to sell.

For 14%, that meant disposing of their entire portfolio, while 38% planned to sell some properties.

Just 2% intended to buy more homes to let.

Landlord tax increase concerns

Mark Long, a director of the firm, said: “The industry has repeatedly warned that increasing taxes on landlords risks increasing costs for tenants.

“Announcing another two percentage point rise before the previous increase has even taken effect suggests those warnings have gone unheard.”

He added: “These are immediate reactions, and intentions to raise rents or sell will not all become reality.

“But the strength of the response should give the Government serious pause for thought.”

Property maintenance spending plans

Spending on maintenance or improvements could also fall, with 29% anticipating cuts, including 13% who expected to reduce it significantly.

However, 55% expected to maintain their spending.

The poll asked about responses to tax rates on rent income of 24%, 44% and 49% from April 2027 for landlords holding property personally, reflecting the combined increases announced in this Budget and last year.

On their property ownership plans, 26% expected no changes and 20% said it was too early to say.

Rent increases after Budget

Nearly three quarters of respondents, 73%, expected the tax changes to lead to higher rents when they were next permitted to increase them.

The largest group, accounting for 38% of all respondents, selected an increase of 5% to 10% or market rents, whichever was higher.

A further 11% selected an increase of more than 10% or market rents, and an increase of less than 5% or market levels was selected by 24%, in the survey.