Summary
In 2025, two-thirds of UK landlords plan to reduce their involvement in the rental market, either by leaving, cutting back their portfolios, or moving to short-term lets. Confidence in the sector has dropped, with 88% of landlords expressing concerns, mainly due to the Renters’ Rights Bill, the end of Section 21 evictions, and reduced profitability. This will lead to fewer long-term rental properties, causing higher rents for tenants. Many landlords also feel the government’s changes are making renting less worthwhile, with health and financial stress also affecting their wellbeing. Without reforms that protect both tenants and landlords, the market will continue to face instability.
The UK rental market is facing a significant shortage as many landlords plan to reduce their involvement or exit the sector entirely in 2025. A recent survey of 942 landlords by SpareRoom, conducted in February 2025, has uncovered some alarming figures.
- 67% of landlords are considering either leaving the rental market, scaling down their portfolios, or shifting to short-term holiday lets.
- A mere 4.5% are planning to expand their holdings next year.
- Confidence in the market has plummeted, with 88% of landlords expressing concerns, up from 81% last July.
- The Renters’ Rights Bill, the abolition of Section 21 evictions, and declining profitability are among their biggest worries.
The outlook for the market appears grim, with 88% of landlords in doubt about its future, rising to 90% in London. A significant proportion—34%—of landlords intend to leave the rental market this year, which will result in fewer long-term rental properties and higher rents for tenants.
Around 29% of landlords are looking to cut back on their portfolios, while 4% plan to transition to short-term lets. In London, the situation is more severe, with 42% of landlords planning to exit the market altogether.
Plans for 2025:
| Plan | % of UK respondents | % of London respondents |
|---|---|---|
| Leave the rental market | 34.1% | 41.5% |
| Reduce my portfolio | 29.3% | 28.6% |
| No changes planned | 28.3% | 35.4% |
| Expand my portfolio | 4.5% | 2.4% |
| Invest in holiday/short-term lets | 3.8% | 2% |
The Renters’ Rights Bill, set to be debated in the House of Lords this week, is a primary concern for landlords, with many worried about the end of Section 21—the right to evict tenants without cause. Reduced profitability, alongside increases in capital gains tax, is also a major source of frustration.
Landlords expressed their lack of confidence for the following reasons:
| Reason | % of UK respondents |
|---|---|
| Renters’ Rights Bill | 88.3% |
| End of Section 21 | 74.8% |
| Reduced profitability | 70.4% |
| Tax increases | 65% |
| Too risky | 56% |
| Capital gains tax | 54.6% |
| Rising mortgage rates | 48.4% |
| Unstable market | 29.8% |
| Decline in property value | 23.6% |
In addition to financial worries, landlords are dealing with health issues, with over half (51%) stating that being a landlord has negatively affected their wellbeing in the past year. Concerns about money, their future pensions, and government interference have taken a toll on their mental and physical health.
Matt Hutchinson, director of SpareRoom, highlighted the issue: “Landlords aren’t all large businesses. Almost half (45%) own just one property, often their life savings. If they’re forced out of the market, tenants will face the consequences. A lack of rental supply is already driving up prices, and if landlords follow through on their plans, the situation will only worsen.”
“The current rental market is not working for anyone. The sector needs reform that both protects tenants and encourages landlords to stay. Without these changes, the instability will continue.”
Several landlords shared their concerns in the survey:
“I’m a responsible landlord, and I take care of my property. But from 2025 onwards, landlords will have no protection. This property is my pension, and I need the same security as tenants.”
“I’m a small-scale landlord worried that I’ll have to sell my property and end my pension plan due to changes in the rental market. I take care of my tenants, but I’m not willing to completely hand over control of my property to them.”
“There’s no incentive left to continue renting out properties. The rewards have always been small, but now it’s not worth the risk or effort. It makes more sense to take my money out of the market and invest elsewhere, where it’s less risky, requires less work, and has fewer tax penalties.