Landlords face £470m rent arrears across England

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Property118

Landlords face £470m rent arrears across England

Landlords in England dealt with an estimated £470m in rent arrears over the course of a single year, according to an analysis of government data.

Research of official figures by the compliance platform, Propoly, found that 210,163 households fell into rent arrears during 2024-25.

The average amount owed across the year was £2,238, producing a national arrears total estimated at £470.3m.

London generated the largest volume of arrears with renters in the capital accounting for £109.5m of that figure.

‘Significant’ scale of rent arrears

The group’s chief executive, Sim Sekhon, said: “The scale of rental arrears we’re seeing across England is significant, with more than 210,000 households falling behind on their rent in a single year.

“When this equates to over £470 million in missed payments, it underlines just how exposed landlords can be when tenant finances come under pressure.

“For many landlords, rental income isn’t simply supplementary, it’s essential to covering mortgage repayments, maintenance costs and wider financial commitments.”

He added: “It’s been a challenging period for household finances, with higher living costs continuing to stretch budgets, so it’s little surprise that a growing number of tenants are struggling to stay on top of their rent.

“However, while the pressures may be understandable, the financial impact on landlords can be severe and, in some cases, destabilising.”

Regional rent arrears

The North West also exceeded £100m, with regional arrears reaching £103.1m.

After that came the South East at £61m, the West Midlands at £58.1m, and Yorkshire and Humber with £38m.

However, the South West recorded the lowest total, at just under £14m for the year.

Ratio of rent arrears regionally

The firm also found that a regional breakdown of households in arrears reveals that of the 210,163 households affected, 23.3% were in London.

The North West accounted for 21.9% of the national total.

The South East represented 13%, followed by the West Midlands at 12.4% and Yorkshire and Humber at 8.1%.

Meanwhile, the South West accounted for the smallest proportion, with just 3% of England’s total.

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Landlords slow to sign up for Making Tax Digital as deadline nears

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Landlords slow to sign up for Making Tax Digital as deadline nears

With less than a month to go until Making Tax Digital comes into force, only 5% of taxpayers, including landlords, have signed up, according to a story in The Telegraph.

Under the controversial scheme, from April 2026 landlords earning more than £50,000 will be required to keep digital records and submit quarterly updates to HM Revenue & Customs using authorised MTD-compliant software.

Landlords earning between £30,000 and £50,000 will be brought into the scheme in April 2027.

People do not understand MTD

Despite HM Revenue & Customs (HMRC) ramping up its campaign to promote Making Tax Digital, sources told The Telegraph that only around 50,000 people, just more than 5% of the estimated 864,000 taxpayers who need to register this year, have signed up so far.

Over the next three years, nearly three million taxpayers are expected to join the scheme.

Rachael Griffin, tax and financial planning expert at Quilter, told The Telegraph that many taxpayers, including landlords, still do not understand how Making Tax Digital will work.

She said: “The low sign‑up figures show that many people still do not understand what quarterly reporting will mean for them, and that gap in understanding risks becoming a pinch-point as we approach implementation.

“The risk is a late scramble among those with mixed income sources who realise too late that the new reporting cycle is not optional.”

No real benefit

As previously reported by Property118, despite the government claiming Making Tax Digital will help landlords, an accountant says this is not the case.

Simon Misiewicz previously told Property118: “There’s no real benefit beyond maybe streamlining some of the work you already do, does it help with tax returns and submissions? The truth is, I can’t see how.

“There’s no advantage for the individual in submitting quarterly returns, because HMRC doesn’t do anything with them until the end of the year. You don’t pay your taxes any earlier, and there is no real cash-flow benefit for the government”.

The government admitted in the Making Tax Digital impact assessment that landlords earning £50,000 could incur an average transitional cost of £285 and an average annual additional cost of £115.

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Rents rise 2% across England – Goodlord

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Rents rise 2% across England – Goodlord

Rents across England rose by 2% year-on-year in February, with the average monthly cost reaching £1,203, the latest Goodlord rental index reveals.

That compares with £1,180 recorded in February 2025.

The annual rent increase also sits below the 2.4% year-on-year rise reported in January and well under the 4% growth recorded at the same point last year.

The index draws on verified tenancy transactions and reflects agreed rental contracts rather than listing prices or advertised rents.

Market is stabilising

The platform’s chief executive, William Reeve, said: “Another month of cooling rental inflation reinforces the picture that the market is returning to some form of equilibrium after a series of record-breaking years.

“This is good news for tenants, particularly if rental price increases continue to sit below wage growth figures.

“It’s also a positive sign that there isn’t a supply shortage, despite the wider regulatory turbulence that landlords are navigating.”

He added: “If these trends continue into spring, it could provide a relatively benign backdrop for the Renters’ Rights Act implementation on 1 May.”

Average rent falls

Regional figures show different movements across the country and in the East of England, average rents fell to £1,305, down 4.5% from £1,367 a year earlier.

The South West also recorded a yearly fall, with rents edging down from £1,218 to £1,208, a drop of 1%.

Northern regions recorded the largest annual increases with the North West seeing average rents climbing from £1,002 in February 2025 to £1,096, an increase of 9.3%.

The North East posted a 5.3% rise, with rents reaching £806.

Regional rent rises

Elsewhere, rents in the East Midlands rose to £963, a yearly increase of 3.7%.

Greater London recorded a 3% increase, with average rents reaching £2,137.

In the South East, rents rose to £1,366, up 1.1% on the year.

The West Midlands saw rents reach £1,018, an increase of 1.8%, while Yorkshire and the Humber recorded a rise of 2.4% to £930.

Month-on-month movements across England, average rents moved from £1,201 in January to £1,203 in February, an increase of 0.15%.

The North West again recorded the largest monthly increase with rents rising from £1,057 to £1,096, a rise of 3.64%.

Voids are shortening

Goodlord also reveals that voids shortened during February after a marked increase in January.

Across England, the average time between tenancies fell from 26 days to 22 days, a drop of 15.4%.

The most pronounced reduction was recorded in the South West, where voids fell from 28 days to 18 days.

In the East of England, the figure dropped from 31 days to 19 days.

In the East Midlands, they fell from 34 days to 25 days, while in the South East they moved from 27 days to 23 days.

In the North West, void periods dropped from 26 days to 22 days and the North East recorded a reduction from 26 days to 23 days.

The West Midlands saw voids fall from 30 days to 27 days.

In Yorkshire and the Humber, the change was smaller, with vacancy periods moving from 24 days to 22 days.

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Should I abandon the strategy that built my wealth?

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Should I abandon the strategy that built my wealth?

Most experienced landlords remember the early logic of their property portfolios very clearly. The strategy was simple; a) acquire residential property with high tenant demand, b) finance it sensibly, c) allow tenants to service the debt, and d) hold the assets long term. Over time, rents increased, and capital values rose.

For many investors that approach produced substantial wealth.

Today, however, a growing number of landlords who successfully built portfolios over the past twenty or thirty years find themselves pausing to ask a difficult question.

Should I abandon the strategy that built my wealth?

The question rarely comes from a single problem; it is usually the result of several pressures arriving at once. Interest rates have increased the cost of borrowing, tax changes have altered the economics of highly leveraged portfolios, and regulation continues to expand across the private rented sector. Some landlords who once saw their portfolio as a straightforward investment now feel they are running a complex operating business.

None of this necessarily means the original strategy has failed; it simply means the environment in which that strategy operates has changed.

For landlords with substantial portfolios, the instinctive response is often to consider selling. At first glance, this can feel like the obvious solution because sales reduce management responsibility and convert property into cash. Yet once the numbers are examined more closely, the decision is rarely so simple.

Capital gains tax can remove a significant portion of the realised value.

Future capital appreciation disappears once the asset is sold.

Rental income, which may have been intended to support retirement, must then be replaced by income from other investments.

Many landlords discover that dismantling a property portfolio can unintentionally destroy the long-term wealth the portfolio created. This is why experienced investors often reach a different conclusion once they step back and analyse their position. The real choice is rarely between keeping everything exactly as it is or selling the portfolio entirely. A third option frequently exists; instead of abandoning the strategy, the portfolio can evolve. In other words, the strategy changes shape rather than disappearing.

For landlords with portfolios worth millions, these decisions become increasingly important. The business that once focused on acquisition gradually shifts towards optimisation, income planning and long-term family legacy. Understanding where your own portfolio sits within that transition is often the most valuable step you can take.

That is why Property118 has developed a detailed Fact Find designed specifically for established landlords. It examines the key elements of a property business including portfolio value, borrowing levels, liquidity and long-term objectives. Completing the Fact Find allows our team to understand your current position and explore what strategic options might exist for the next phase of your property journey. For many landlords the exercise alone provides a moment of clarity. The question then becomes not whether the strategy should be abandoned, but how it should evolve.

Important Notice – Scope of Planning Support

Where our recommendations touch on areas requiring regulated input, we refer clients to appropriately authorised professionals for advice and execution.

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Gen Z renters lack knowledge of credit scores and rent rules

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Property118

Gen Z renters lack knowledge of credit scores and rent rules

More than seven in 10 of Gen Z renters felt overwhelmed, uncertain or anxious when first looking for a home to rent, research reveals.

Figures from Housing Hand’s Understanding Renters in 2025 report, highlight several gaps in knowledge about the basics of renting.

Gen Z is those aged between 12 and 29, and of the tenants surveyed, 85% said they did not receive enough financial education at school to prepare them for renting.

As a result, 36% said they turn to family members for advice and 31% rely on websites, while 16% seek guidance from friends.

The firm’s sales manager, Dani Smith, said: “Young people should feel excited about heading out into the world and renting their first home, but lack of knowledge is denting confidence and negatively impacting the experience from the start.

“The Renters’ Rights Act presents a huge opportunity to address a range of issues in the rental sector, including knowledge gaps among tenants.”

Unsure about financial checks

The findings also show uncertainty around financial checks used by landlords and letting agents.

While 82% of Gen Z renters said they know what a credit score is, 45% said they do not understand how it affects their ability to secure a home to rent.

Knowledge of standard tenancy requirements appears uneven with 35% of respondents admitting they did not know what a rent guarantor was.

Just 32% said they knew about depositless rent schemes, while half of respondents, said they were aware of tenancy deposit protection schemes.

Overwhelmed looking for a home

When asked how they felt when starting the search for a property, respondents aged 16 to 30 most often selected negative responses.

Around 26% said they felt overwhelmed, 20% uncertain, 19% anxious and 8% scared.

The survey also asked how younger tenants would respond if they encountered financial difficulty.

Among those surveyed, 59% said they would not know what to do if they could not pay their rent.

In that situation, 84% said they would turn to their parents for support.

And two-thirds of respondents, said they were uncertain about how the deposit return process works.

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Google searches for Making Tax Digital hit record high

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Google searches for Making Tax Digital hit record high

Searches for Making Tax Digital have surged ahead of the April deadline, according to new research.

Under the controversial scheme, from April 2026, landlords earning more than £50,000 will be required to keep digital records and submit quarterly updates to HMRC using authorised MTD-compliant software.

Landlords earning between £30,000 and £50,000 will join the scheme in April 2027.

614% increase in search term

Analysis of Google Trends by Censuswide, commissioned by software platform Coconut, shows that interest in the term “Making Tax Digital” peaked on 10 February 2026, reaching an index score of 100, the highest level ever recorded in the UK, and a 614% increase compared with 10 December 2025.

In recent weeks, the government has ramped up its campaign for Making Tax Digital with the government publishing guidance to help landlords find the right software for MTD, including a list of approved software providers.

Alongside this, a new online search tool has been launched, which asks a series of questions tailored to sole traders and landlords, before generating a personalised list of compatible MTD software options.

However, as previously reported by Property118, despite the government claiming Making Tax Digital will help landlords, an accountant says this is not the case.

Simon Misiewicz previously told Property118: “There’s no real benefit beyond maybe streamlining some of the work you already do,” he says. “Does it help with tax returns and submissions? The truth is, I can’t see how.

“There’s no advantage for the individual in submitting quarterly returns, because HMRC doesn’t do anything with them until the end of the year. You don’t pay your taxes any earlier, and there is no real cash-flow benefit for the government”.

The government admitted in the Making Tax Digital impact assessment that landlords earning £50,000 could incur an average transitional cost of £285 and an average annual additional cost of £115.

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The Property118 Housing Research Panel

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Property118

The Property118 Housing Research Panel

Property118 has spent more than a decade reporting on the private rented sector, helping landlords, journalists, lenders and policymakers understand the commercial and regulatory realities shaping housing supply.During that time, Property118 has also played a quieter but equally important role. We have helped academic researchers engage directly with landlords, supported university research projects, and ensured that findings reached practitioners rather than remaining confined to academic journals.

Now, Property118 is taking the next logical step. We are formalising that work into a structured research initiative designed to measure landlord sentiment, rental supply intentions, refinancing conditions and sector confidence on an ongoing basis.

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Are tenants beginning to see the problem of landlords leaving?

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Property118

Are tenants beginning to see the problem of landlords leaving?

Like Thelma and Louise hurtling towards the cliff edge, more people are beginning to see the problems coming with the Renters’ Rights Act.

Thankfully, tenants are now asking why landlords are leaving and why rents are rising.

I say that after reading the comments under a BBC story this week about rents topping £1,000 a month across more than half of Britain’s neighbourhoods.

The story appeared on Property118 too, but the Beeb’s version didn’t just attract the predictable landlord-bashing.

But sadly, much like Thelma and Louise, I suspect we are already too close to the edge to slam on the brakes and save the private rented sector in its current form.

Zoopla’s research shows the average rent for a new tenancy is now more than £1,000 a month in 52% of British neighbourhoods, up from just 23% in 2020.

Rents have risen 36% over five years. Wages have increased too, though nowhere near enough to keep pace.

Rental supply shrinking

Predictably, the commentators said this was bad because landlords are simply charging more.

However, instead of a pile on of others agreeing that landlords are raking in cash for doing nothing (!), I was struck by a new narrative.

It is probably being driven by growing numbers of tenants discovering the basic economics of supply and demand as they try to find somewhere to live.

Several pointed to something landlords have warned about for years: thousands are selling up.

When supply shrinks but demand stays strong, rents rise. That is not ideology; it is arithmetic.

There was even a nod to the rising costs for landlords, from mortgages to tax and regulation, which inevitably land with the tenant at the end of the line paying more.

For years this argument was dismissed as special pleading from landlords protecting their interests.

But now renters themselves are beginning to feel the consequences.

Who replaces selling landlords?

One tenant explained that their landlord had increased the rent by £150 a month after being forced to pay for professional compliance advice.

Others raised the longer-term structural problem: if smaller landlords exit, who replaces them?

In many cases the answer is not first-time buyers.

It is increasingly likely that institutional investors, property companies or cash buyers expanding portfolios will be stepping in.

And more tenants appear to be appreciating what small landlords offer, rather than faceless corporations.

No one defends rogue landlords or poor housing standards, but government policy often has unintended consequences, particularly when it collides with economic reality.

Young people are struggling

Young people are being hit from all sides: high rents, high house prices and large student debts.

For many of them, renting privately is not a lifestyle choice since it has become the only viable housing option.

If the market continues to shrink, the consequences extend far beyond landlords and tenants.

Labour mobility suffers and graduates cannot easily move cities for work.

Their disposable income drains away into housing costs rather than the wider economy.

And yet much of the political conversation continues to treat landlords as a problem to be eliminated rather than being part of the housing system.

What replaces the small landlord?

The irony is brutal and the very people the Act was meant to protect are about to discover that ‘corporate’ and ‘institutional’ landlords are remote and slower to fix things.

Councils and housing associations leave some properties dangerous for years, yet the narrative is that every private landlord is a pantomime villain.

The Act will see more landlords heading for the exit, rents will keep climbing but tenants are starting to speak.

They can see what is happening now, and that’s without the struggles facing landlords after May’s implementation of the Act.

All tenants need to understand that this crisis was made in Westminster, not by the people who actually provide the homes.

Demonise productive capital and watch it vanish.

The unintended consequence is staring us in the face: fewer homes, higher rents and a generation locked out.

And like Thelma and Louise discovering gravity at the edge of the canyon, the laws of supply and demand have a habit of asserting themselves whether politicians believe in them or not.

Until next time,

The Landlord Crusader

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Councils collect just 25% of landlord fines

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Councils collect just 25% of landlord fines

Councils in England have collected only a quarter of the civil penalties issued to landlords for housing offences over the past two years, research reveals.

The National Residential Landlords Association says its data was obtained through Freedom of Information requests to English councils responsible for PRS enforcement.

Across 2023/24 and 2024/25, 285 councils imposed almost £30 million in civil penalties on private landlords.

Just under £7.5 million of that total was actually recovered.

Fed-up responsible landlords

The NRLA’s chief executive, Ben Beadle, said: “Tenants and the vast majority of responsible landlords will rightly be fed up with our findings.

“For too long a minority of rogue and criminal operators have allowed to act with impunity, bringing the sector into disrepute.

“It is galling then to see that those breaking the law are still failing to pay the price – leaving good landlords to pick up the tab in licensing fees.”

He added: “This also raises serious questions about how ready councils are to enforce the Renters’ Rights Act, and about the adequacy of the upfront funding provided to them to support enforcement action.”

RRA implemented in May

The NRLA says that the same records show that nearly 3,700 civil penalties were issued to landlords during the two-year period.

Its research has been published ahead of the Renters’ Rights Act coming into force on 1 May.

Under the legislation, the maximum civil penalty available to councils will increase from £7,000 to £40,000.

According to the NRLA, the figures indicate that councils are not collecting funds that could otherwise be used to support enforcement activity in the private rented sector.

Examine council enforcement funding

The organisation says the issue raises questions about how local authorities will enforce the new regime once the higher civil penalties become available.

Alongside the research, the NRLA is calling for the creation of a new Chief Environmental Health Officer post with a national remit for improving enforcement standards.

It is also urging the government to undertake a full assessment of the resources currently available to local authority enforcement teams.

It says an analysis of the funding they will require to enforce the Renters’ Rights Act is needed.

The organisation also says councils should be required to publish an annual report setting out enforcement activity relating to the PRS in their area.

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Landlords told not to wait until Decent Homes Standard to fix rental homes

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Landlords told not to wait until Decent Homes Standard to fix rental homes

The government insists private landlords must not wait until the Decent Homes Standard 2035 deadline to improve rental properties.

Under the Decent Homes Standard, landlords will need to meet certain criteria, including that homes must be in a reasonable state of repair and provide core facilities and services, including a kitchen with adequate space and layout, an appropriately located bathroom and WC, and adequate protection from external noise.

A government document says homes must also be equipped with child-resistant window restrictors and provide a reasonable degree of thermal comfort.

Should not wait until 2035 deadline

In a written question, Labour MP Vicky Foxcroft asked the government: “Whether it has an assessment of the potential merits of expediting implementation of the Decent Homes Standard to improve maintenance practices in privately rented properties.”

In response, Housing Minister Matthew Pennycook claimed landlords must improve rental properties before the 2035 deadline.

He said: “Private rented sector landlords should address non-decency wherever it exists. While we are giving landlords until 2035 to implement our new Decent Homes Standard, we have made clear they should not wait until 2035 to improve their properties.

“We are also acting in other ways to ensure private tenants have safe, warm, and decent homes, including introducing new Minimum Energy Efficiency Standards for the sector; strengthening local authority enforcement in respect of unremedied hazards; and applying Awaab’s Law Act to the private rented sector through the relevant provisions in the Renters’ Rights Act.”

The government have previously claimed “too many tenants are living in poor quality housing”, with 21% of homes in the Private Rented Sector (PRS) and 10% of homes in the social rented sector failing to meet the Decent Homes Standard.

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