A survey commissioned by LegalforLandlords found that 70% of landlords were considering rent increases ahead of a four-percentage-point rise in property income tax rates for individual landlords from April 2027. Of those surveyed, 32% said they planned to increase rents specifically to offset the additional tax burden, while a further 38% were considering putting rents up.
Just 22% said they would absorb the extra cost, and 8% believed their local rental market could not support further increases. The findings raise concerns about the potential impact on rental supply, although the figures reflect landlords’ intentions rather than confirmed rent increases or property sales.
Almost half consider cutting portfolios
The research found that 47% of landlords were considering reducing their property investments. That includes 23% weighing up the sale of one or more rental properties and 17% considering selling their entire portfolio. More broadly, 61% said they were either actively planning to leave the private rented sector or seriously considering doing so.
The tax changes are also affecting investment plans. Some 45% said they had decided against buying additional properties, while just 2% still intended to expand their portfolios. Another 35% had not planned to buy more properties in any case.
Landlords expect profits to take a hit
Nearly three-quarters of respondents expect the tax changes to affect their profits. Some 37% anticipate a substantial reduction, while another 37% expect a noticeable fall. Only 6% believe the changes will have no impact on profitability.
The survey also found that 88% were unhappy with the additional tax. Meanwhile, 83% believed the changes would make the private rented sector worse for landlords and tenants.
Warning over rents and housing supply
Sim Sekhon, group CEO of LegalforLandlords, warned that tenants could face higher rents and reduced choice if landlords scale back investment. “The concern is that tenants could face pressure from two directions. In the immediate term, landlords are telling us that additional taxation and rising operating costs could lead to higher rents,” he said.
“But there is also a longer-term question about what happens if landlords increasingly decide that investing in the private rented sector is no longer financially viable.” Sekhon warned that further landlord sales and weaker investment could put pressure on the supply of privately rented homes.
However, he urged landlords not to rush into selling. “We would encourage landlords who are feeling the pressure not to make any hasty decisions about selling up or leaving the sector,” he said. He recommended reviewing finances, tax arrangements and portfolio management before making decisions.
The survey questioned 651 UK private landlords on 5 November 2026. ProperPR conducted the research through Find Out Now on behalf of LegalforLandlords. The results capture landlords’ reactions to the proposed tax burden, rather than evidence of how many will ultimately raise rents, sell properties or leave the sector.
