UK House Prices Rise as Landlords Face Renters’ Rights Act Squeeze

UK house prices rose in April even as mortgage costs increased and the Renters’ Rights Act began changing the rules for landlords in England. Nationwide said prices climbed 0.4% month on month, taking the average home to £278,880, while annual growth rose from 2.2% to 3.0%.

The rise cuts against the pressure building around the housing market. Buyers are dealing with higher mortgage rates after the Iran war lifted energy and inflation concerns, while landlords are entering a new rental regime that reduces flexibility and may push more buy-to-let owners to reconsider whether the returns still justify the risk. Nationwide’s figures were stronger than economists expected and showed the market regaining momentum after a weaker spell around the turn of the year. Its chief economist, Robert Gardner, said the market had continued to recover despite uncertainty from the Middle East and higher energy prices, helped by stronger household finances and improved affordability compared with recent peaks.

Mortgage demand has also held up better than the economic mood suggests. Bank of England data showed house-purchase approvals increased to 63,500 in March from 62,700 in February, while remortgaging approvals rose to 51,300 from 41,200. Those numbers point to buyers still moving before the full impact of higher mortgage pricing and rental-law changes works through the market. Higher borrowing costs are already making the next phase harder. The Iran war has revived concerns about energy prices and inflation, which has pushed markets to expect interest rates to stay higher for longer. When mortgage rates rise, buyers lose spending power quickly because the same income supports a smaller loan. April’s house-price rise shows that pressure has not yet stopped the market nationally. Wage growth, savings buffers and lower household debt have helped buyers absorb some of the shock, while limited housing supply continues to support prices in many areas. The result is a market that looks resilient on the surface but more sensitive underneath.

The Renters’ Rights Act adds a separate pressure point for buy-to-let owners. From 1 May 2026, private landlords in England can no longer serve new Section 21 no-fault eviction notices, and most private renters now have stronger protection from eviction. Landlords must rely on legal grounds for possession, while the new regime also changes how rent increases and tenancy security work.

For tenants, the reforms bring greater security at a time when rents have stretched household budgets. For landlords, the calculation has become tougher. Higher mortgage costs, tax pressure, maintenance bills and tighter regulation were already weighing on buy-to-let returns before the new rules arrived.

Some landlords will adapt and stay in the market. Others may decide that the combination of lower flexibility and higher costs makes selling more attractive. Savills research found that 38% of tenancies that ended in 2024 and 2025 so far were linked to landlords selling up, although only 6% of those directly cited the Renters’ Rights Bill. A separate Savills agent survey found 29% of landlords viewed the new regulations as their primary concern. That distinction keeps the story grounded. Landlords are not leaving for one reason. Finance costs, tax treatment, repairs, regulation and uncertainty all feed into the decision. The Renters’ Rights Act may accelerate some sales, but it sits inside a wider squeeze on buy-to-let returns.

More former rental homes coming to market could give buyers extra choice, especially flats and smaller homes often owned by landlords. April’s data shows buyer demand has still been strong enough to absorb the pressure at national level. Prices rose despite dearer mortgages, weaker confidence and the start of a major rental-market reset. The split between buyers and renters may now become sharper. A rental home sold to an owner-occupier can help one household get on the ladder, but it can also remove a property from the rental pool if another landlord does not buy it. Extra sales stock can support first-time buyers in some areas while leaving tenants with fewer homes to rent. First-time buyers still need finance as well as supply. A former buy-to-let property only becomes an opportunity if the buyer can secure a mortgage at a manageable monthly cost. Higher rates can turn extra availability into frustration if borrowing power falls at the same time.

Regional differences will decide how much pressure appears. Areas with stronger wages, tight housing supply and active first-time buyers may absorb landlord sales without much price weakness. Markets with stretched affordability or heavy investor ownership could feel more strain if buy-to-let sellers arrive in larger numbers. For homeowners, April’s rise offers reassurance without removing risk. The average price has reached £278,880, but higher mortgage rates can still reduce the number of buyers able to meet asking prices. Sellers may face a more selective market even while national data remains positive. Property investors face a different calculation. House prices have not rolled over under the first stage of the shock, but rental rules, finance costs and potential tax pressure are changing the return profile. Capital growth may still be available, yet the income side of buy-to-let looks more demanding.

The timing of the data also deserves caution. House price indices often reflect deals agreed weeks earlier, before every rate move, confidence shock and regulatory change has fully shaped behaviour. The next few months will give a clearer view of whether April’s rise was durable strength or delayed reaction.

UK house prices are now moving against forces that would usually slow them. Buyers face higher mortgage costs. Landlords face tighter rules. More buy-to-let owners may test the sales market. Prices still rose in April. The latest Nationwide data points to a housing market with more support than expected, but also more stress building beneath the headline numbers. If mortgage rates remain elevated and landlord selling grows, the pressure may show up later. If wages, savings and limited supply keep supporting demand, prices could stay firmer than the wider economy suggests.