Private rental households in England forecast to rise by 500,000 by 2035

Private rental households in England forecast to rise by 500,000 by 2035

The UK government projects the private rented sector in England will grow by approximately 500,000 households over the next decade, reaching over 5.3 million homes by 2035, according to a recent impact assessment linked to Awaab’s Law.

The government’s impact assessment on extending Awaab’s Law to private rented tenancies reveals that in 2026 there are around 4.8 million households renting privately in England. This figure is expected to increase steadily by about 1.2% annually, surpassing five million households by 2029 and reaching an estimated 5.38 million by 2035.

However, the government acknowledges uncertainty in these forecasts, particularly regarding the number of landlords. The latest reliable data on landlords dates back to 2019-20, indicating approximately 2.3 million landlords in England. Since then, trends in landlord numbers are unclear, and the government notes the possibility of sector consolidation as landlords seek economies of scale, especially when undertaking remediation work under new regulations.

Government projections and their basis in Awaab’s Law impact assessment

The forecast figures come from the government’s impact assessment for the application of Awaab’s Law to private rental properties. Awaab’s Law, initially applied to social housing, aims to strengthen landlords’ obligations to address hazards such as mould and damp promptly. The extension to private rentals is expected to increase compliance requirements and remediation work for landlords.

The government’s projection of private rental household growth is based on current rental trends and demographic factors. The sector’s growth rate of 1.2% per year reflects ongoing demand for rental accommodation amid housing affordability challenges and changing household formation patterns.

Despite this, the government stresses the limitations of available data, particularly on landlord numbers and behaviour. The assumption that landlord numbers will remain relatively stable is cautious, acknowledging that market forces or regulatory changes could lead to consolidation or shifts in landlord profiles.

Implications for landlords and letting agents in the expanding private rental sector

The forecast growth in private rental households signals a continued and expanding role for private landlords and letting agents in England’s housing market. For landlords, this means managing larger portfolios or entering the sector amid evolving legal and safety obligations, especially with the forthcoming application of Awaab’s Law.

Landlords should anticipate increased scrutiny on property conditions and quicker remediation requirements for hazards such as damp and mould. This will likely necessitate more rigorous property inspections, prompt repair responses, and potentially higher costs associated with compliance and maintenance.

Letting agents will also face greater responsibilities in advising landlords, managing compliance documentation, and ensuring tenancy agreements reflect new legal standards. The sector’s growth could increase demand for professional letting services, but also heighten regulatory oversight.

Challenges and uncertainties for the private rented sector outlook

While the government’s projections provide a useful framework, several uncertainties remain. The lack of up-to-date data on landlord numbers and behaviour complicates precise forecasting. Market dynamics, such as changes in mortgage availability, tax policies, or tenant demand, could alter growth trajectories.

Moreover, the impact of new regulations like Awaab’s Law on landlord consolidation is unclear. Some landlords may exit the market due to increased compliance costs, while others might expand portfolios to achieve economies of scale in managing remediation work. The balance of these factors will shape the sector’s future size and composition.

Additionally, regional variations in rental demand and regulatory environments may influence growth unevenly across England, affecting local markets differently.

What landlords should consider amid sector growth and regulatory change

Landlords should review their property portfolios and compliance procedures in light of the forecast sector growth and upcoming legal changes. Ensuring properties meet safety and habitability standards will be critical, particularly regarding damp and mould issues targeted by Awaab’s Law.

Maintaining accurate records of inspections, repairs, and tenant communications will help demonstrate compliance and manage risks. Landlords may also consider the financial and operational implications of potential sector consolidation and increased remediation responsibilities.

Engaging with letting agents who are knowledgeable about evolving regulations can support landlords in navigating these changes effectively. Staying informed about government consultations and guidance will be essential to anticipate further developments.

Supporting landlords with compliance and property management tools

The Landlord Association (TLA) offers resources and support to help landlords and letting agents manage compliance amid sector growth and regulatory updates. TLA membership provides access to practical compliance information, document templates, and expert guidance tailored to private rental obligations.

TLA is also developing ORBIT, a new property management and compliance platform currently in BETA testing. ORBIT aims to assist landlords and agents in organising property records, managing rental documentation, and recording key actions such as repairs and inspections. This platform could be particularly valuable for landlords preparing for the expanded requirements under Awaab’s Law and the anticipated growth in the private rented sector.

Exploring TLA membership and ORBIT BETA access can help landlords stay organised and maintain evidence of compliance, supporting effective property management as the sector evolves.

Looking ahead, landlords should monitor regulatory developments closely and prepare for a rental market that is likely to grow both in size and complexity over the coming decade.

Sources: Landlord Today