2024 tested landlords’ limits – Will 2025 offer a smoother path?

What a year! For landlords, 2024 has been an unpredictable rollercoaster, blending relentless challenges with glimmers of opportunity. From the ongoing possession crisis to changing tax landscapes and shifting yields, this year has tested the mettle of anyone in the private rented sector (PRS). But it hasn’t been all doom and gloom - there are positive signs for landlords who’ve stuck it out, including a rise in buy-to-let yields. As we close the chapter on 2024, let’s reflect on its highs, lows, and lessons while looking ahead to 2025. 

It’s impossible to discuss 2024 without tackling the growing possession crisis. For landlords trying to regain control of their properties, this year has been nothing short of frustrating. 

County courts are buckling under the strain. At Landlord Action, we’ve seen landlords in London waiting over 18 months for bailiff appointments. Courts managed by the Stratford Housing Centre - including Barnet, Clerkenwell, and Willesden - are particularly bad, with evictions now being scheduled as far out as mid-2025. Even worse, some landlords have had appointments simply cancelled, leaving them in legal and financial limbo. 

This bottleneck isn’t just a paperwork issue; it’s a direct result of a shortage of county court bailiffs, with just 300 available across England and Wales. Meanwhile, the abolition of Section 21 “no-fault” evictions is expected to add even more pressure to an already overburdened system. 

For landlords at their wits’ end, High Court (HC) enforcement is emerging as a faster (but more costly) alternative. However, even this route isn’t straightforward, as judges increasingly require landlords to first attempt county court enforcement. It’s another example of how the system is pushing landlords to their limits. 

Amid the turmoil, landlords received some good news in Q3: buy-to-let yields continued their upward trend. According to data from Paragon Bank, the average yield reached 6.72% in September, up from 6.69% at the end of Q2 and 6.48% a year ago. 

This rise in yields shows that, despite increasing regulation and market pressures, the fundamentals of buy-to-let remain strong in certain areas. For landlords able to weather the storm, higher yields offer a buffer against rising costs and reduced tax relief. 

The growth in yields also reflects ongoing demand for rental properties as the supply of housing tightens. With many landlords exiting the market due to tax and regulatory burdens, those who stay are reaping the benefits of reduced competition. It’s a reminder that while the PRS faces significant challenges, opportunities remain for those who adapt and persevere. 

Beyond the possession crisis and yield increases, this year brought a slew of legislative and economic changes that kept landlords on their toes: 

Tax changes: The Spring Budget delivered a mixed bag. While the rate of Capital Gains Tax (CGT) on property remained unchanged, tax-free allowances were slashed again, leaving landlords with less room for profit. The Autumn Budget added insult to injury, with a two per cent stamp duty hike on second homes and investment properties. 

Election fallout: Labour’s victory in May led to the introduction of the Renters’ Rights Bill, which will abolish Section 21 and tighten rules on evictions and rental bidding wars. While the Bill included some safeguards for landlords, such as clearer rules for reclaiming properties, it certainly highlighted the Government’s pro-tenant agenda. 

Rising rents: With fewer landlords in the market, rental prices continued to soar. Some tenants now face increases of up to £200 per month, highlighting the growing affordability crisis. 

As we head into 2025, the big question is whether stability is finally on the horizon. Labour’s focus on renter protections suggests that more regulatory hurdles are coming, but there’s also hope that clearer policies will bring much-needed certainty. 

For landlords, the key to thriving in this environment will be adaptability. Whether it’s navigating the new legal framework, exploring HC enforcement options, or capitalising on rising yields, those who stay informed and adapt accordingly will be best positioned to succeed. 

Stay proactive on possession: If you’re dealing with arrears, act quickly. Consult legal experts to explore HC enforcement and avoid lengthy delays. 

Monitor market trends: Rising yields are a bright spot - identify areas where demand remains strong and consider restructuring your portfolio to maximise returns. 

Engage with the community: Attend forums and workshops to stay informed about legislative changes and connect with other landlords facing similar challenges. 

Advocate for landlords: We need to shift the narrative. Landlords aren’t villains - they’re essential to housing supply. Let’s keep pushing for fair treatment and practical solutions. 

2024 was a tough year, no doubt about it. But it also reinforced the resilience of landlords who are committed to their investments and their tenants. As we move into 2025, let’s focus on the opportunities that still exist in the PRS. Rising yields, evolving strategies, and a clearer policy landscape could make the coming year one of recalibration rather than retreat. 

At Landlord Action, we’re here to support you every step of the way, whether it’s navigating possession delays, understanding new regulations, or maximising your property’s potential. Together, let’s make 2025 a year of progress and perseverance.