Buy-to-let experts fear new rent-review powers will push landlords to sell, tightening rental supply
Labour’s flagship Renters’ Rights Bill has prompted warnings from mortgage brokers and property professionals that new rent-review powers could hit buy-to-let investment and shrink the UK’s already strained rental market.
The legislation would allow tenants to challenge agreed rents within the first six months of a tenancy or contest any new rent proposed by a landlord. Agents and landlords have warned that giving tenants wider rights to appeal rent increases could effectively cap prices, discouraging investment and prompting some owners to sell.
The National Residential Landlords Association (NRLA) has raised concern that the tribunal system responsible for hearing rent challenges lacks the resources to handle a likely surge in cases. Its policy chief, Chris Norris, said the system “does not have the resources, or capacity, to properly consider and decide upon cases in anything like a reasonable time frame”, warning that delays could amount to “de facto rent controls” if left unaddressed.
The Bill would also require landlords to give at least two months’ notice for rent increases and ban any rise during the first 52 weeks of a tenancy. Daniel Smith, senior associate at law firm Gardner Leader, noted that landlords “will no longer be able to rely upon [existing lease] provisions”, meaning rent changes must now be issued through formal notice procedures.
Market data already points to growing caution. A JLL survey found that half of landlords have postponed plans to expand their portfolios amid uncertainty, while Simply Business reports that 39 per cent are considering leaving the market entirely within the next year. The firm said this reflected a “sense of trepidation” among property owners who doubt the reforms will raise standards as intended.
Mortgage brokers warn that the changes could have unintended consequences for lending and tenancy structures. Kessar Salimi, of Freedom Financial, said: “Although it will deter some landlords and reduce housing supply, all that will do is increase rents due to higher demand for existing properties.”
Mitesh Manek, of Our Mortgage Broker, predicted that landlords may respond by shortening tenancy terms. “Landlords potentially may opt for shorter tenancies like six months and then look at discussions with tenants around rent increases by month four, giving two months’ notice if they don’t agree,” he said. “It would leave tenants more vulnerable as they need to move every few months to find a suitable place to rent.”
Private landlords account for around 84 per cent of all tenancies in the UK. While ministers argue that the Renters’ Rights Bill will rebalance the market in favour of tenants, property experts warn that tighter regulation could deepen the housing shortage and push rents higher.
For the mortgage market, the impact could be significant. Brokers expect stronger demand for short-term and remortgage products as landlords reassess portfolios and adapt to a more tightly controlled environment.
