Fresh warnings are emerging from the private rented sector that looming tax changes could drive more landlords out of the market and push rents higher.
A survey from Pegasus Insight shows the proposed 8% National Insurance levy on rental income is now landlords' biggest worry.
More than 8 in 10 describe the idea as 'very concerning' with fears rising that Chancellor Rachel Reeves could introduce the charge in her Autumn Budget.
On top of that, almost three quarters of landlords are deeply worried about further Capital Gains Tax changes.
Among those who have already sold or intend to sell within a year, that jumps to 85%.
Tax rises a threat
The firm's founder and director, Mark Long, said: "The tax burden is now seen by landlords as every bit as threatening as regulation.
"The possibility of a new National Insurance charge on rental income is causing alarm across the sector, not just because it would erode profitability, but because it would further undermine confidence in what has already become a heavily taxed form of investment.
"Many landlords feel that another policy shock, on top of CGT and the Renters' Rights Act, could tip the balance and force them to sell."
Landlords assessing sales move
He added: "Every indication from our data is that a growing number of landlords are reassessing their position.
"If the November Budget adds yet another layer of taxation, we can expect more to exit the market in 2026, further reducing rental supply at a time of rising demand."
The survey also points to a market already shifting with 40% of landlords saying they will sell at least one property within the next 12 months.
Just 7% of landlords said they expect to buy.
With tenant demand high, any further contraction in supply risks pushing rents up, Pegasus says.
Younger landlords will be hit
The Pegasus report lands alongside a new analysis from Hamptons, which shows that not all landlords will be hit equally if NI is charged on rental profits.
It says that landlords under the age of 65 would take the biggest hit if the proposal became reality.
Currently, individual landlords are not liable for NICs but under the proposal, they would pay 8% on profits up to £50,270 and 2% above that.
That would be in line with employees, while retired landlords would remain exempt and limited company structures would not be affected.
Hits BTL profitability
Hamptons says a landlord earning £16,478 in annual rent and paying £7,875 in mortgage interest would see their tax bill more than double, rising from £699 to £1,609.
For higher-rate taxpayers, profits could fall to £295, raising questions about the long-term viability of some portfolios.
Younger landlords, often operating with less equity and more borrowing, would feel the strain most.
A Hamptons' spokesperson said: "While the reform would improve parity between rental and employment income, it risks further reducing the profitability of buy to let – particularly for those with high mortgage costs and limited equity.
"The definition of 'profit' is key: if NICs are applied before mortgage interest relief, it would amplify the chances of higher-rate taxpayers having to pay tax on loss-making properties.
"Unlike the removal of mortgage interest relief (Section 24), which hit higher-rate taxpayers hardest, this proposal could have a greater impact on lower-income landlords."
Student landlords concerned
The managing director of Accommodation for Students, Simon Thompson, said: "Student landlords will be watching these tax proposals more closely than anyone because their margins are already stretched.
"A new levy on rental income could make the difference between holding a property and handing in the keys for some."
He added: "The Budget's timing could not be worse for cities already dealing with student housing shortages.
"If more student homes disappear from the market, universities will feel the impact almost immediately and you can't increase supply overnight, students will be the ones paying the price."
