UK landlords are warning of an “unsustainable” private rented sector as new legislation, tax changes, and energy rules converge. An NRLA survey shows 54% expect to sell more buy-to-let properties if Section 24 tax restrictions remain, with nearly one in four already preparing to exit ahead of the Renters’ Rights Bill.
Renters’ Rights Bill driving exit plans
The NRLA’s latest Landlord Eye survey found the Renters’ Rights Bill is the most significant factor eroding landlord confidence, accounting for 41% of all concerns cited. Many fear the removal of Section 21 will make it harder to regain possession when tenants are in arrears or causing damage.
A portfolio landlord from the South West told the NRLA: “Having to both meet criteria for a court case where a tenant is in arrears, creating a nuisance or not treating the property with respect will be difficult, and the wait times will no doubt be unacceptably lengthy as I do not believe the government will increase resources enough at all.”
The research shows 24% of landlords are already preparing to leave, while another 24% are waiting to see the final shape of the Bill. Some have accelerated sales, aiming to avoid a more challenging legal environment.
Tax reforms and digital reporting adding to pressure
Making Tax Digital (MTD) is another major concern, with 67% expecting it to impact them. From April 2026, landlords earning over £50,000 will have to submit quarterly updates using HMRC-approved software, with the threshold dropping to £20,000 in 2028.
Only 34% feel confident about meeting the new reporting requirements. One East of England landlord quipped: “Making Tax Difficult, oops I mean Digital, is the main reason for considering exiting the sector. I do not know many landlords whose cashflow will survive paying tax month after month on ‘income’ that has not been received.”
Section 24—introduced in 2015 to restrict mortgage interest relief—remains a long-term sore point. More than a third (36%) of landlords say they are considering leaving the sector entirely because of it, while just 11% would expand their portfolios if the rule stays.
EPC upgrades pose cost and timing challenges
Nearly half of landlords (49%) have at least some properties with an EPC rating of D or below, while 34% have all properties at C or above. Meeting proposed Minimum Energy Efficiency Standards (MEES) would be costly: 40% say they would need to use personal savings, and 39% would increase rents to fund upgrades.
The NRLA warns that for student landlords, a final policy decision expected in late 2026 could leave just one summer—2027—to carry out works, creating a “perfect storm” of tradesperson shortages, EPC assessor delays, and tenant turnover pressures.
The data paints a clear picture: multiple legislative, fiscal, and regulatory changes are converging, with many landlords reassessing their future in the sector. If the government’s aim is to boost tenant protections without shrinking rental supply, it must address the bottlenecks and burdens that threaten to drive good landlords out. The next two years will decide whether this is a reset for the PRS—or the start of a deeper contraction.
