"If there’s a positive here, given that smaller landlords are the ones most likely to leave the market, this could lead to increasing professionalisation of the private rented sector, and drive moves to limited company structures as landlords look to adapt to the change"
- Rob Stanton - Landbay
More than seven in every ten brokers (72%) expect their landlord clients to reduce the size of their portfolios if National Insurance (NI) is applied to rental income, according to polling by Landbay.
The buy-to-let (BTL) lender asked brokers how they believed the move could affect their average landlord client’s investment decisions.
Over a quarter of respondents said they thought their landlord clients would sell some properties, trimming their holdings while remaining in the private rental sector.
Almost half of brokers (45%) said they expected their landlord clients to sell all their properties and leave the market entirely. Taken together, this means that 72% of landlords could be selling properties if the government proceeds with the proposal.
Just under a quarter of brokers (23%) believed the change would make no difference, while 5% thought landlords might expand their portfolios.
Landlords could face paying National Insurance on rental income if plans leaked by HM Treasury over the summer are included in Rachel Reeves’ November budget. The chancellor anticipates that this extra tax will raise £2.3bn, as she seeks to address a reported £40bn gap in the nation’s finances.
“Rachel Reeves is looking for tax-raising measures that will enable Labour to claim it has not broken its election promise to increase VAT, income tax or NI," says Rob Stanton, sales and distribution director at Landbay (pictured). "But she may not raise as much as she expects. The amount of tax she expects to raise is based on ONS figures, which show that, during the most recent tax year data published (2022/3), some 2.2 million landlords received £27 billion in rental income."
"I am worried this might backfire, though. First, she’s not going to raise that much if a million landlords sell-up, however resilient the sector is in the face of market interference. Second, this could drive up rents, as demand for rental property outstrips diminishing supply and remaining landlords look to recoup the cost by raising rents. That could exacerbate the housing crisis for renters."
“If there’s a positive here, given that smaller landlords are the ones most likely to leave the market, this could lead to increasing professionalisation of the private rented sector, and drive moves to limited company structures as landlords look to adapt to the change.”
Landbay polled 50 brokers via email and LinkedIn during September 2025.
