The National Residential Landlords Association has called on the government to take action on growing cost pressures in the rental sector, warning that landlords face paying an average of £1,100 more per year on mortgages compared to early March – costs that most cannot absorb without raising rents.
The intervention comes as financial data provider Moneyfacts reports that borrowing costs have spiked to their highest levels since 2024, driven by the ongoing conflict in the Middle East and resulting volatility in global markets.
Multiple cost pressures converge
The NRLA says landlords now face rising costs on several fronts simultaneously. These include a planned increase in income tax on rental income from April 2027, which the independent Office for Budget Responsibility has warned will lead to higher rents.
Landlords also face uncertainty over costs associated with joining the planned Private Rented Sector Ombudsman and database under the Renters Rights Act, plus expectations of spending up to £10,000 per property to meet new energy efficiency requirements.
This follows Landlord Knowledge’s report on the Bank of England’s warning that 5.2 million borrowers face higher payments as fixed-rate deals expire into a market where rates have climbed sharply.
Ben Beadle, chief executive of the NRLA, said the government should take action where its own policies will lead to higher rents. “Whilst the government cannot be held responsible for the impact of the conflict in the Middle East, it should take action where its own policies will lead to higher rents,” he said.
“Growing taxes, uncertain costs associated with the Renters Rights Act and the ongoing housing benefit freeze will create the perfect storm for tenants.”
Average rental income below minimum wage
The NRLA points to HMRC data showing the average rental income declared by unincorporated landlords is £19,400 per year – significantly less than what someone earns from a full-time minimum wage salary. The association argues this undermines the narrative that landlords can simply absorb ever-increasing costs.
“It is simply stereotyped nonsense that every landlord can somehow absorb ever-increasing costs indefinitely,” Beadle said. “They can’t, and as a result, it is tenants who will suffer most as rents continue to creep up.”
Low-income tenants face a double blow from rising rents combined with the ongoing freeze on housing benefit rates, which have not kept pace with market rents since 2020. According to recent Propertymark analysis, only 2 percent of rental properties are now affordable at Local Housing Allowance rates.
NRLA calls for four policy changes
The association has outlined four measures it wants the government to implement:
- Scrapping the planned income tax increase on rental income
- Keeping costs for the PRS Ombudsman and database as low as possible
- Reforming tax to support energy efficiency improvements
- Unfreezing housing benefit rates for low-income tenants
The NRLA argues against rent controls, warning they would “simply choke off the supply of homes to rent at a time when tenant demand remains so high”. According to NRLA data, there are almost five tenants competing for every available home to rent.
What this means for landlords
- If you’re remortgaging: Budget for significantly higher monthly payments compared to your current deal – rates have risen sharply since early March
- If you hold personal portfolios: The 2027 income tax rise will reduce net returns – review whether incorporation makes sense for your situation
- Watch for: Announcements on RRA ombudsman and database fees, expected before the 1 May implementation date
- Housing benefit landlords: Consider whether guaranteed rent schemes through local councils offer more stability than direct lets
- Bottom line: Cost pressures are intensifying from multiple directions – review your numbers and plan accordingly
Editor’s view
The NRLA’s intervention highlights the growing disconnect between political rhetoric and economic reality. Ministers cannot simultaneously pile costs onto landlords and expect rents to stay flat. Something has to give – and with tenant demand outstripping supply five to one, the pressure will inevitably flow through to rents.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 3 April 2026
Sources: NRLA, Moneyfacts
Related reading: Bank of England warns 5.2 million borrowers face higher mortgage costs
