Labour's war on landlords sends rental property supply to an all-time low
The rental market is experiencing a supply crisis as landlords sell up amid an increasingly hostile business environment, new data has revealed.
The number of UK properties available to let has hit an all-time low of 284,000, tumbling 18pc in the year to March, according to analytics firm TwentyCi. The figure marks a 23pc fall compared to the number of lets available before the pandemic.
A third of landlords are now looking to sell off some or all of their rental properties, according to the latest English Private Landlord Survey, while the number of respondents leaving the lettings industry altogether quadrupled from less than 20,000 to over 80,000.
Among landlords planning to scale back operations or sell up entirely, 'recent legislative changes' was the most-selected reason for their plans (65.6pc). This is not surprising – in her first Budget, Chancellor Rachel Reeves raised stamp duty on second homes and buy-to-lets from 3pc to 5pc with immediate effect.
In the first quarter of 2025, 15.6pc of properties newly for sale had been rented at some point during the past three years, up from just 9.3pc at the start of 2023, according to TwentyCi.
Meanwhile, the Renters' Rights Bill, set to take effect in July, will ban no-fault evictions, fixed-term tenancies, bidding wars and mid-contract price hikes. Rental properties that fall short of energy efficiency standards are also set to be banned by 2030, with landlords facing an average bill of £10,000 to bring their properties up to code.
Unfortunately for landlords, the bad news may not stop there. Labour MPs want to increase the amount of tax landlords pay on rental income, The Times reported last week.
This move would help the Government raise money while keeping its promise to not raise taxes on 'working people' – with Sir Keir Starmer having previously suggested that landlords do not meet the definition.
HM Revenue and Customs (HMRC) filings show average property income declared came to £16,700 in the 2022-23 financial year, the latest for which data is available, down 10.8pc since 2018 in real terms.
'The kind of fall [in the number of rental properties available] supports our long-held view that government policy is dissuading investment and driving landlords to look elsewhere for returns,' said Chris Norris, chief policy officer at the National Residential Landlords Association (NRLA).
'There is an acute imbalance between the demand and supply of homes in this country, which is being exacerbated by successive governments' policies towards private renting.'
Tenants are paying the price for an exodus of landlords from the market, which is pushing monthly rents to new highs. Average UK rents were 4.5pc higher in the first quarter of 2025 compared to the same period the year before, according to Rightmove data.
TwentyCi's data also revealed that almost half – 46pc – of available properties to let are listed at prices exceeding £1,500 per calendar month, with over 15pc requiring tenants to fork out more than £3,000 each month.
Angharad Trueman, president of property professionals' body Propertymark, said: 'This continues to be an ongoing concern in regard to the unintended consequences of the Renters' Rights Bill as if this trend continues, supply levels will worsen and consequently, so will rent costs.
'Tenants, who the legislation is designed to help, will ultimately be left feeling the brunt of this national issue. We need urgent Government support to revitalise the market and encourage investment before it's too late.'
A Ministry of Housing, Communities and Local Government spokesman said: 'We do not recognise this data. Recent figures show that there has been an 18pc year-on-year increase in the number of available homes to rent, and the supply and demand balance is narrowing.'
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