Why Do Rents Really Go Up? The Truth About Rental Increases

When your rent goes up, is it just because your landlord feels like charging more? Is it just “greedy landlords” hiking prices? The reality is a lot more complicated. Let’s break down who actually gets your rent money, and at the end, I’ll share what’s really driving up rents today.

1. Where Does Your Rent Actually Go?

Let’s say you’re paying £1,500 a month in rent.

• Mortgage Payments: The landlord pays about £900 a month to the
  bank.
• Taxes: Then, around £400 goes to HMRC in tax.
• What’s Left: That leaves about £200 for the landlord.
• Repairs & Maintenance: If something breaks, that could cost another £100, leaving the landlord with just £100 for themselves.

2. Rising Costs - How Things Can Change Fast

But what if the landlord’s costs increase?

• If interest rates on the mortgage go up, that £900 payment could jump to £1,100.
• If the government changes tax rules (like Section 24), the landlord could be taxed on profit they haven’t even made, or even end up paying out of pocket.

Suddenly, that small profit turns into a loss.

3. So Who’s Really Pushing Rents Up?

When you see rents rise, it’s often because:

• The bank is demanding more in mortgage payments.
• HMRC (the taxman) is taking a bigger slice.
• Unexpected costs (repairs, new regulations) eat away at what’s left.

In many cases, landlords are just trying to break even, not cash in. But the media rarely covers this side of the story - they’d rather paint landlords as the bad guys.

The Key to Understanding: Look Beyond the Headlines

Next time your rent goes up, remember: it’s not always just about the landlord. The bank, the government, and rising costs all play a huge part.

Final Thoughts

The rental market is more complex than most people realise. By understanding where your rent money really goes, you can see that “greedy landlords” are often just the easiest target. If we want real solutions, we need to look at the bigger picture: taxes, interest rates, and policies that shape the market for everyone.