Landlords Under Fire: Is Buy-to-Let Still Worth It in 2027?

If you’re a buy-to-let landlord — or an “accidental” one who didn’t plan to be here — you’re probably feeling it already.

Rising interest rates, shrinking tax reliefs and ever-growing regulation have made property feel less like an investment and more like a second job.

And now, there’s more to come...

The Great Landlord Exit: Is This the Beginning of the End for Buy-to-Let?

From April 2027, tax on rental income is due to rise by two percentage points. That will push rates to 22% for basic-rate taxpayers, 42% for higher-rate taxpayers and 47% for additional-rate taxpayers. On its own, that might not sound dramatic — but landlords know this isn’t happening in isolation.

Over the past decade, the buy-to-let model has been steadily squeezed. Mortgage interest tax relief has been largely removed. Extra stamp duty applies when buying rental property. Capital gains tax allowances have been slashed. At the same time, borrowing costs have surged, and compliance has become more complex and more expensive.

Energy efficiency rules, constant regulatory changes and the Renters’ Rights Act all add to the pressure. For many smaller landlords — particularly those with interest-only mortgages — margins are now painfully thin.

It’s no surprise that landlords are voting with their feet. The number of homes bought by landlords has fallen sharply over the last decade, and an estimated 200,000 rental properties left the market in the year to March 2025 alone. Many are simply deciding that the hassle no longer justifies the return.

There is a flip side. With fewer landlords competing for smaller properties, first-time buyers are finally seeing some breathing room, with a record share of purchases going their way in 2025. From a policy perspective, that looks like success.

But the wider picture is more complicated.

England still relies heavily on the private rented sector, and demand hasn’t gone away. Fewer rental homes, combined with slow housebuilding and a long-term decline in social housing, risks pushing rents higher over time. While large, purpose-built rental developments are growing, they remain a small part of the market and are nowhere near big enough to replace the loss of private landlords.

For buy-to-let and accidental landlords, this is a moment to pause and reassess. The sector isn’t disappearing — but it is changing fast. Understanding your tax position, reviewing ownership structures, and planning ahead has never been more important.

The days of buy-to-let being a simple, low-effort investment are long gone.

The question now isn’t just how much tax will I pay? — it’s does this still work for me?

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The final straw for UK Landlords?