Half of English landlords held rents flat last year while inflation ran at 3.5%. That gap compounds silently, and it is what separates the landlords who will be selling soon from the ones who will be buying from them.
What Has Happened?
The TDS Charitable Foundation published survey results covering more than 2,000 private landlords in England. The headline figure: 50% of those landlords kept rents unchanged in the past 12 months. A year earlier, the same survey put the proportion at 39%. The Renters' Rights Act came into force on 1 May 2026. These two data points are connected.
Under the Renters' Rights Act, landlords in England can only increase rents once per year. They must use a formal Section 13 notice, served on the correct Form 4A, with at least two months' notice for monthly periodic tenancies. Tenants can challenge any proposed increase at the First-tier Tribunal for Residential Property. The tribunal is required to set the rent at the local market rate, not simply rule on the landlord's proposed figure. If it decides the market rate is below the landlord's current rent, it can reduce it.
The Deposit Protection Service published a separate PRS review in August 2026, taken in the months after the Act took effect. It found that the majority of landlords planned to maintain current rent levels for the following six months. Both surveys are pointing in the same direction: more landlords are choosing not to raise rents than at any point in recent years.
The context matters. Published data from earlier in 2026 showed that 73% of rent increases submitted to the First-tier Tribunal were reduced below the landlord's proposed figure. That record, combined with the procedural requirements of Section 13, has created a deterrent that is affecting landlord behaviour at scale. Whether the deterrent is rational depends on the individual landlord's circumstances. But the aggregate effect on sector yield is becoming visible in the data.
Why This Matters to UK Property Investors
UK CPI inflation was 3.5% in September 2026. A property generating £800 per month in rent that sat at the same level all year has generated £28 less per month in real purchasing power terms by October. That is £336 per year on a single property. Across a portfolio of ten properties held at frozen rents, it compounds to £3,360 annually, from a lower nominal base into the following year.
The ONS reported average UK private rents up 3.8% in the 12 months to September 2026. If 50% of landlords are running at zero increase, the other 50% must be averaging roughly 7.5% to produce that national mean. These are not two equivalent groups making the same trade-off. The landlords raising rents at 7% to 8% are mostly the professional portfolio operators who understand Section 13, apply it on schedule, and have comparable evidence ready. The ones sitting at zero are more often single-property landlords, accidental landlords, or investors who have decided the process is more trouble than it is worth.
This split matters because it determines where motivated vendors will come from over the next two years. A landlord whose real return is declining each year, whose compliance complexity is rising under the Renters' Rights Act, and who sees no sign of cost pressure easing, will at some point run the sell-or-hold calculation. The ones running below-market rents reach that point faster than those whose income is keeping pace with costs.
For investors still acquiring, the data also creates a specific type of opportunity that I will cover in section 4.
The Risks Investors Need to Understand
The most direct risk is silent yield compression. A property acquired at a 7% gross yield based on last year's rent figure may be generating a materially lower real yield today if rent has been static while interest rates, service charges, and compliance costs have moved. This does not appear in the gross yield headline. It only appears when you run the numbers on actual net income against the current 4.82% average BTL financing cost (UK Finance Q2 2026).
The tribunal track record is a real deterrent, but it is not a blanket one. The 73% reduction rate covers two types of cases: landlords who proposed increases genuinely above market rate, and landlords in lower-turnover markets where comparable lettings evidence is thin. A landlord in a location with few recent comparable listings faces a harder challenge evidencing market rate than one in a high-demand city where 20 similar properties have been advertised in the last three months. The deterrent is unevenly distributed, but it is having an even effect on landlord behaviour because many landlords do not distinguish between these scenarios.
The Section 13 lock-in is the second structural risk. Under the Renters' Rights Act, an increase can only take effect once per year. There is no mechanism to apply a cumulative catch-up. A landlord who skips this year's review starts from the frozen base next year. Three years of frozen rents cannot be recouped in a single Section 13 application. The annual window is the only window, and the opportunity cost of missing it compounds every 12 months.
Some landlords are making a deliberate choice to hold rents below market to keep reliable tenants. Under an Act that makes possession through the courts an average 33-week process, keeping a good tenant at a modest below-market discount can be cheaper than a possession case and a void period. That calculation is defensible in specific cases. The risk is that what starts as a deliberate short-term retention strategy becomes a habit, and the financial gap between income and market rate widens without a conscious decision to let it.
Where the Opportunity Could Be
The landlords holding rents at 2023 or 2024 levels are, by definition, running below-market income on assets where market-rate comparables exist and could be evidenced. For a buyer, that creates a specific acquisition opportunity. Buy the property, take over the management properly, apply Section 13 within the first year to bring the rent to market rate. The yield improvement is real and does not require any capital expenditure.
The opportunity is most concentrated in the single-property landlord segment. These are the landlords most likely to have frozen rents, most likely to find Renters' Rights Act compliance disproportionate to their scale, and most likely to be running a sell-or-hold calculation before the finances get truly painful. A buyer who reaches them before the property goes to a local estate agent is in the strongest negotiating position. The property does not yet have a comparable-based asking price. The landlord's motivation is real. The deal can be done at a price that reflects the landlord's specific position, not a portal valuation.
Property Investor App's landlord-to-landlord network gives investors access to sellers before they list publicly. A landlord who is considering selling a below-market-rent property benefits from a direct conversation with a buyer who can move quickly, without the agent fee, at a price that reflects their actual situation. That is the channel I would be using before approaching any open-market listing.
For investors who already hold property in England, the lesson from the TDS data is simply to run the annual review. A Section 13 notice served on schedule, with comparables prepared, does not automatically result in a tribunal hearing. Most tenants accept a reasonable increase without challenge. The tribunal deterrent is real for increases that are genuinely excessive, less so for increases that track market movement with evidence behind them.
Arsh's Investor View
I have been expecting this data for about six months. When the Renters' Rights Act took effect in May, the Section 13 process became the only legal route to a rent increase in England. The tribunal's power to reduce rents below the landlord's proposed figure was always going to spook people who had never been through it. But 50% of landlords holding flat? That is higher than I would have predicted.
My read is that two things are happening at the same time. Some landlords are making a deliberate choice to hold rents below market to keep good tenants in place. Under an Act that makes a contested possession case a 33-week process on average, keeping a reliable, rent-paying tenant at a small below-market discount is a rational trade-off. I understand that decision.
The other group is frozen by inaction. Not a strategic choice. An avoided decision. The rent falls in real terms every quarter without any corresponding benefit. That is money left on the table, and it adds up.
What this data tells me about the acquisition market is what I find genuinely interesting. These are not distressed landlords. UK Finance data shows BTL arrears at an eight-quarter low. But their returns are quietly declining. In my experience, that cohort starts looking at the exit door before the finances get truly painful. The properties they sell often come with below-market tenancies that, for a buyer who knows how to run a Section 13 review in year one, represent an immediate yield improvement. That is exactly the type of deal I look for.
How Property Investor App Can Help
Property Investor App gives investors access to the UK's landlord-to-landlord deal network, including sellers who have not yet listed publicly. For investors looking to acquire properties where rents are currently running below market, PIA's network allows you to connect directly with single-property and portfolio landlords who are considering a sale before committing to open-market listing. PIA's deal comparison tools let you model the current rent, the market rate, and the yield improvement available through a Section 13 review in year one of ownership. For landlords in the 50% who are holding rents flat and running the sell-or-hold calculation, PIA provides the market context and the network to make that decision with current data. Browse UK property investment opportunities on Property Investor App.
Key Takeaways
- TDS Charitable Foundation survey of over 2,000 private landlords in England: 50% held rents unchanged in the past 12 months, up from 39% the previous year. The shift coincides with the Renters' Rights Act taking effect on 1 May 2026, which restricted rent increases to once per year via a formal Section 13 notice.
- UK CPI ran at 3.5% in September 2026. ONS data shows average private rents up 3.8% nationally. If half of landlords are at zero, the other half are averaging roughly 7.5% increases. The professional portfolio cohort and the single-property or accidental landlord cohort are moving in opposite directions.
- The First-tier Tribunal has been reducing 73% of rent increase applications submitted to it, acting as a practical deterrent for landlords who are uncertain of their comparables evidence. The deterrent is real but overstated: most Section 13 notices do not result in a tribunal hearing if the proposed increase tracks market rate with evidence.
- Missing the annual Section 13 review means starting from the frozen base next year. There is no cumulative catch-up mechanism under the Renters' Rights Act. Three years of frozen rents at a property cannot be recovered in a single application.
- For buyers, landlords running below-market rents represent a specific acquisition opportunity: properties where a Section 13 review in year one can improve yield without capital expenditure. Direct access through PIA's landlord-to-landlord network, before these properties reach agents, puts the buyer in the strongest negotiating position.
Frequently Asked Questions
Why are so many landlords in England not raising rents in 2026?
The Renters' Rights Act, which came into force on 1 May 2026, restricts rent increases to once per year via a formal Section 13 notice. Tenants can challenge any proposed increase at the First-tier Tribunal, which has been reducing 73% of increases submitted to it. That record deters landlords who are uncertain about their comparables evidence or who find the process administratively complex. Some landlords are also making a strategic choice to hold rents below market to retain reliable tenants, since obtaining possession under the Renters' Rights Act now requires specific grounds, formal notice periods, and court proceedings that averaged 33 weeks in 2026.
What is the Section 13 process for raising rent under the Renters' Rights Act?
A landlord in England can propose a rent increase by serving a Section 13 notice (Form 4A) on the tenant. The notice must give at least two months' warning for monthly periodic tenancies before the new rent takes effect. The increase can only happen once every 12 months. The tenant can accept the new rent, negotiate directly, or refer the increase to the First-tier Tribunal within the notice period. The tribunal then sets the rent at the local market rate for a comparable property. If the tribunal sets a higher rate than proposed, the landlord can accept or withdraw the application.
How does the rent freeze trend affect buy-to-let yields?
A landlord who holds rent flat while UK CPI runs at 3.5% is generating lower real income each year from the same asset. On an £800 per month property, the real-terms shortfall accumulates at roughly £336 per year. For a leveraged investor running a BTL mortgage at the current 4.82% average rate (UK Finance Q2 2026), the margin between rental income and financing cost narrows without any change in the headline figures. Over a portfolio of five to ten properties held at frozen rents, the cumulative effect is material. Annual Section 13 reviews to market rate, done correctly and on schedule, are the mechanism to avoid this.
Is buying a property with a below-market tenancy a good buy-to-let investment?
It depends on the discount to purchase price and the gap between the current rent and the local market rate. A property where rent is running 15 to 20% below market, acquired from a landlord who has not reviewed in two or three years, can see yield improved materially through a Section 13 application in year one of ownership without any capital expenditure. The risk is that if the current tenancy started within the last 12 months, a Section 13 review cannot take effect until the 12-month mark. Properties where rent has been static for several years and the tenancy predates the Renters' Rights Act are typically the clearest opportunity of this type.
Will the First-tier Tribunal always cut a landlord's proposed rent increase?
No. The 73% reduction figure covers applications where landlords proposed increases that were above local market rate, or where comparable letting evidence was limited. A Section 13 notice that proposes an increase tracking local market movement, backed by three to five comparables from recent listings of similar properties nearby, is far less likely to be reduced than one with no supporting evidence. Most Section 13 notices do not result in tribunal hearings at all. Tenants in a functioning tenancy with a reasonable proposed increase typically accept it or negotiate a compromise without escalating to the tribunal.
