NRLA outlines market's key challenges ahead of Budget
The National Residential Landlords Association (NRLA) is calling on chancellor Rachel Reeves to address critical challenges in the UK rental market in the upcoming Budget, highlighting key areas where government intervention is needed to ease pressure on tenants and support the private rental sector.
The landlords group noted that a lack of rental supply is creating significant issues for tenants, with demand outpacing availability. According to property portal Zoopla, an average of 21 people now compete for each available rental property — more than twice the pre-pandemic level. The imbalance is limiting tenant choice, driving up rents, and making it more difficult for tenants to avoid rogue landlords due to limited housing alternatives.
Tina Paillet (pictured left), president of the Royal Institution of Chartered Surveyors (RICS), stated that rental supply constraints continue to put pressure on tenants, calling for measures to “increase supply and make housing more affordable.”
The NRLA has recommended abolishing the 3% stamp duty surcharge for landlords who purchase, refurbish, and reintroduce long-term vacant properties to the rental market.
The NRLA also warned that additional tax burdens on landlords would likely exacerbate rent increases.
Paul Johnson (pictured centre), director of the Institute for Fiscal Studies, noted that “the more harshly that landlords are taxed, the higher rents will be.” He attributed a significant portion of recent rent hikes to increased tax obligations on landlords, cautioning against further measures that could inflate costs for renters.
With new energy efficiency standards expected in the private rented sector, the NRLA is calling for government support to help landlords comply. The Committee on Fuel Poverty has suggested that tax offsets, loans, or grants could aid landlords — particularly those in lower-rent areas with limited profit margins — in making necessary upgrades.
The NRLA also highlighted the need for stability in housing benefit rates, specifically the Local Housing Allowance (LHA), which is currently pegged to the lowest 30% of local rents. The Joseph Rowntree Foundation has warned that if LHA rates remain frozen, private tenants on housing benefits could lose an average of £700 annually by the end of this parliament.
Meera Chindooroy (pictured right), deputy director for campaigns, public affairs and policy at the NRLA, emphasised the urgency of these measures.
“Tenants across the country are struggling due to a chronic shortage of homes to rent,” she said. “The Chancellor needs to announce pro-growth tax measures and support for energy efficiency investments. At a minimum, it’s essential for the government to provide certainty by keeping housing benefit rates aligned with market rents.”
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