Nearly half of buy-to-let landlords (44%) plan to pre-emptively raise rents in response to the new Renters’ Rights Bill, survey data from Landbay can reveal.
Under the Renters’ Rights Bill, landlords will be limited to just one rent increase per year to the market rate – the price that would be achieved if the property was newly advertised to let.
Tenants however have the opportunity to challenge this at a first-tier tribunal if they believe it exceeds market rate.
The bill will also remove of Section 21 evictions.
Rob Stanton, sales and distribution director of Landbay, said: “This sharp rise in rents in the short term shows the unintended consequence of this new regulation, as landlords look to act now and pre-emptively raise rents in fear of future cost implications or difficulties, and to protect their investments.
“By forcing the hand of landlords in this way, there is a real risk of worsening the cost-of-living crisis that so many private renters are currently facing.
“Any good and reasonable landlord will agree with protecting the rights of tenants, but they also believe that the rights of the property owner should be protected too.
“There’s no doubt we need to balance reform with support and safeguards for landlords to make sure that the rental market continues to play the important role it does in the UK’s housing mix.
“While we may not be able to influence government policy or regulation, our role as a BTL lender is to ensure our product range is competitive and delivers exactly what landlords need – whether that’s for purchases or refinancing.”
Of those who are raising rents specifically because of the Renters’ Rights Bill, landlords with portfolios of between four and 10 properties are most likely to increase rents (32%), closely followed by those with between 16 and 30 properties (28%).
Properties in the South East are most likely to be impacted, followed by those in the North West.