Burnham's arrival puts buy-to-let landlords on alert

Andy Burnham's arrival in Downing Street on Monday has sharpened focus on what a reset of the UK's relationship with the private rented sector could mean in practice, and brokers working with buy-to-let clients are already fielding questions about how to prepare.

Burnham, who succeeded Sir Keir Starmer as prime minister after winning the Labour leadership unopposed, has a well-documented interest in housing. As mayor of Greater Manchester, he championed social housebuilding, criticised council tax as regressive, and built a mayoral record that placed housing at the centre of his political identity. He has appointed John Healey – a former housing minister – as chancellor, and Angela Rayner as housing secretary.

Among the policy signals drawing most attention from the buy-to-let market is his backing for a proportional property tax – a model proposed by the Fairer Share campaign group – that would replace council tax and stamp duty land tax with an annual charge based on current assessed property values. Second homes and rental properties would face a rate of 0.96% under that model. For a landlord holding a £300,000 rental property, that would amount to an annual charge of £2,880. Burnham has also not ruled out a rent freeze as part of his first package of measures – a position he held publicly as far back as 2023.

Housing back at the top of the political agenda

Jeni Browne (pictured top left), sales and marketing director at Mortgage Finance Brokers, told Mortgage Introducer landlords have grown accustomed to weathering political turbulence, but argued this change of leadership felt different.

"We've been through five chancellors in the last few years, so landlords are pretty used to tuning out the noise and just getting on with it," she said. "But this one feels a bit different. Burnham and Healey both actually know housing, which could go either way. It might mean more joined-up thinking, but it also means property is probably first in line when this government starts looking for money."

Browne flagged two specific concerns she is already raising with clients – the proportional property tax proposal, and Burnham's refusal to rule out a rent freeze. "Neither of these is government policy yet," she said. "But I'd be telling clients not to wait around for the detail before thinking about their structure, their portfolio, and how much flex they've got in their rent strategy, because it feels like the direction here is pretty clear, even if the specifics aren't."

A professionalised market under pressure

Joe Stallard (pictured top right), managing director of House and Holiday Home Mortgages, told Mortgage Introducer sustained tax and regulatory pressure had already transformed the buy-to-let landscape, filtering out casual investors and concentrating ownership among professionals.

The shift had been driven largely by changes to mortgage interest tax relief, which removed much of the financial logic of holding properties in personal names and pushed landlords towards incorporation. Research by Pegasus Insight for Foundation Home Loans, in its Q4 2024 Landlord Trends report, found 74% of rental properties were held within a limited company structure by the end of 2024, up from 36% in early 2020.

"It's professionalised really," Stallard said of the buy-to-let market. "Property tax accountants have picked up money because they're giving more advice and restructuring things from personal name to limited companies. The dinner party landlord, who might have inherited a property, have been sort of driven out of the market and that property's gone to a professional investor, so I would say it's kind of really professionalised the market as a whole."

The consequence, he argued, had been the opposite of what successive governments intended. "I would be surprised if it's had the impact they wanted to by freeing up loads of houses for first time buyers to go and buy.”

Over-regulation, he added, has pushed rents higher rather than bringing them down. "All they're doing is driving the rents up, which is actually having the negative impact that they intend it to. Those properties are getting bought by other landlords and tenants are the ones feeling the increase in rent costs, which is then putting them further away from being able to buy the property that they want to get on the ladder."

The risk of policies that look good on paper

On rent controls, Stallard is direct. Across the broader UK housing market, professionals have warned such measures tend to suppress supply rather than reduce rents, pushing tenants further from homeownership by widening the affordability gap.

"These sort of punchy, headline grabbing, quick win policies rarely turn out to be that," he said. "I'd urge them to do the right research, get the right advice around them before putting in these policies that look good on paper but actually end up having the adverse effect of what they want them to do."

Opportunity within uncertainty

Despite the unsettled outlook, Stallard pushed back on the idea buy-to-let clients should be gripped by anxiety. For those operating professionally, he said the uncertainty was less acute than it might appear from the outside.

"I think for those who know what they're doing and who are doing it properly, I'm not sure there is that much concern," he said. "Of course, it's getting harder, but actually these things do bring about opportunity as well. People who are doing the right thing in the right way, I think will always do alright in that sense."

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