Proper news from Britain - News from Britain you won’t find anywhere else. Not the tosh the big media force-feed you every day!
Tenants will foot the bill for painful tax hikes Rachel Reeves imposed on landlords in the Budget, property insiders warn.
The Chancellor increased income tax on money made from renting out properties from 20 to 22 per cent for landlords paying the basic rate, and from 40 to 42 per cent for those on the higher rate.
It will net the Treasury £500million extra per year by 2028-29.
This extra cost will be passed to tenants through higher rents, it is claimed.
Michael Cook, chief executive of estate agents LRG, described the move as 'a back-door stealth tax on renters rather than landlords'.
While rent rises have eased off this year, tenants are still stinging from double-digit annual percentage rises in the aftermath of the pandemic.
Average advertised rents outside of London rose 3.1 per cent to a record high of £1,385 per month in the year to the end of October 2025, according to Rightmove.
This represents 44 per cent of the average person's salary, the property website said, up from 40 per cent five years ago.
Tenants could even be forced to leave their homes as a result of Reeves' tax increase which will bite in April 2027, property experts said, as more landlords will decide to quit the market all together.
Adam Jennings, head of lettings at estate agent Chestertons, said the move will have 'dire consequences' for tenants.
'More landlords could decide to sell up which will result in fewer available rental properties and leave more renters struggling to find a property within their budget,' he added.
While bad news for tenants, this could prove positive for those looking to get on the property ladder.
David Hollingworth, associate director at broker L&C mortgages, said: 'This will be another big blow to landlords who have been increasingly hit by measures that have made it harder to maintain returns on rental property.
'If they choose to exit, it may potentially free up property for first time buyers.'
It is the latest in a string of punishing tax hikes landlords have had to contend with in the past decade.
In her previous Budget in October 2024, Reeves added a 2 per cent stamp duty surcharge for landlord buying properties on top of the extra 3 per cent they already pay, adding thousands of pounds to the cost of buy-to-let purchases.
Landlords who own property in their own name, rather than in a company structure, are also now unable to fully offset mortgage interest costs against their tax bill as they did previously.
Some are also concerned about the impact of the Renters Rights Act which became law last month but has not yet been fully enacted.
This bans 'no-fault' evictions, meaning landlords must prove they have a good reason to ask tenants to move out, and stops landlords from tying tenants in to fixed-term contracts.
It will also stop landlords from refusing renters because they have children or receive benefits, and from refusing requests from tenants to keep a pet without good reason.