Revealed: 3 in 4 landlords concerned about the future of the market

An uphill struggle for the new government 

The Labour party won a majority in the general election in July 2024. We asked what kind of impact they think the new government will have on the rental market: 

• 51 per cent think a very negative impact 
• 20 per cent think a slightly negative impact
• 13 per cent are unsure about the impact 
• 10 per cent think it will have no discernible impact 
• 6 per think think a positive impact (slightly or very)

And with 69 per cent of landlords stating that constantly changing and confusing legislation is their biggest challenge, the new government has work to do. Landlords need clarity from the new government on what’s expected of them and this starts with the Renters’ Rights Bill. 

The impact of the Renters’ Rights Bill  

The Renters’ Rights Bill is set to bring about the biggest changes to renting in decades. Following on from the previous government’s Renters’ Reform Bill, the new government has laid out its plans for landlords and tenants. 

The key changes are: 

• a ban of Section 21 evictions 
• tenants will have the right to keep pets 
• a limit on rent increases to once a year in line with market rates
• an end to blanket bans on letting to tenants with children or those on benefits
• a ban on bidding wars on available rental properties

With 37 per cent of landlords saying increased regulation of the market, such as the Renters’ Rights Bill, is the biggest threat to the private rental sector – there’s an air of uncertainty as the bill progresses through parliament. 

The end of Section 21 evictions 

The headline measure of the Renters’ Rights Bill is a proposed ban on Section 21 evictions. With the ban first being pledged by the Conservative government in 2019, it has long loomed over the sector. 

We asked landlords what kind of impact they thought banning Section 21 would have: 

• 69 per cent said evictions will become more expensive and time-consuming
• 62 said it will make landlords sell up and leave the market 
• only five per cent said it will be easier to evict tenants who break their tenancy agreement

Although 71 per cent of landlords told us they’ve never used a Section 21 eviction, this suggests that they view the opinion as a vital safety net.

Minimum energy efficiency standards return

The government has reintroduced plans to increase the energy efficiency of rental properties as part of their Warm Homes Plan. Now, all rental properties will be required to have a minimum Energy Performance Certificate (EPC) rating of C by 2030. 

With 50 per cent of landlords needing to make changes to their rental property to reach the new minimum EPC rating, these plans are significant. 

Of greater concern  is that 11 per cent of those needing to make improvements will need to spend more than £10,000 to get their property up to scratch. Meanwhile, over a third (34 per cent) will need to spend between £1,000 and £10,000 to meet the new minimum EPC rating. 

Looking ahead 

With huge changes to legislation on the horizon, many landlords are adopting a wait-and-see approach. 

Almost two thirds (62 per cent) aren’t looking to sell in the next 12 months and 62 per cent feel letting a property is a worthwhile investment. 

But with the majority of landlords concerned about the future of the rental market, it’s clear that the next 12 months and specifically the impact of the policies in Renters’ Rights Bill, will be key. 

Simply Business’s UK Chief Operating Officer, Bea Montoya, shared her thoughts on the findings: “Although most landlords welcome increased standards across the market, they need more clarity on regulations so they can prepare accordingly. And this starts with the Renters’ Right Bill, which marks the biggest changes to tenancy law in a generation.”  

“Insuring more than 300,000 landlords allows us to gain first-hand insight into the integral role they play in the housing market. But with three quarters (75 per cent) of landlords concerned about the future of the private rental sector, it’s more important than ever to understand their challenges and perspective.”

How do you feel about the future of the renal market in the UK? Let us know in the comments below.

More useful articles for landlords

• A guide to capital gains tax for landlords 
• A landlord’s responsibilities for property maintenance
• What is a buy-to-let investment?
• Do you need landlord insurance? 

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