The lettings sector in Devon is already experiencing pressure. With a limited supply of rental properties and high demand from tenants, any changes to legislation or the market can have an immediate impact.
The recent introduction of the Renters’ Rights Act has prompted many landlords, tenants, and agents to question how it might affect the local rental market – and whether it could lead to an even tighter supply of homes.
Emma Foreman, Lettings Director at Complete, explains: “The market is already experiencing a short supply of lettings stock, and I do not envisage the Renters’ Rights Act leading to an increase in this supply. If anything, there will be greater competition for the properties that are available, as some landlords exit the sector and tenants choose to stay put due to limited choice.”
The Budget and its impact on the lettings market
The recent Budget generated significant anticipation, with many wondering if it would affect the wider housing market. While the sales sector largely avoided disruption – unless operating in the multi-million-pound bracket – the lettings sector has felt the impact.
The key updates affecting landlords and tenants include:
1. Tax on Rental Profits Up 2%
For landlords, the effective tax increase on rental profits from 2027 is an added burden on already-tight margins, particularly for higher-rate taxpayers still adjusting to Section 24 changes.
This means net yields are likely to fall, reducing overall profitability, landlords may request rent reviews to maintain income levels, and some landlords could consider selling properties or pausing future acquisitions.
Strategic conversations around pricing, portfolio structure, and long-term planning have become more crucial than ever to navigate the evolving landscape successfully.
2. Knock-on effects for tenants
Changes in the lettings sector inevitably impact tenants. With landlords under increased financial pressure, tenants may experience:
- Rent increases as landlords protect margins
- Stricter affordability assessments
- Increased competition for fewer rental homes
- Greater challenges in high-demand areas
For many tenants, this means fewer options and potentially higher costs for comparable properties, particularly in Devon’s most sought-after areas.
3. Housing supply will tighten further
There was little in the Budget to encourage landlords to stay in the sector. Combined with ongoing regulatory changes, this creates the potential for a reduction in available rental properties.
Currently, around 18% of “for sale” stock in Devon is made up of landlords exiting the market. If this trend continues, tenants will face fewer homes to choose from, greater competition for available properties, and upward pressure on rents, particularly in areas of high demand.
Emma notes: “Limited supply combined with high tenant demand means landlords who stay in the market will face greater competition to secure good tenants. Those who are proactive and strategic in their approach will be best positioned to succeed.”
What landlords can do
In an environment of tightening supply and increased financial pressures, landlords need clarity and guidance. Key steps include:
- Portfolio review – Understanding which properties are performing and where rent reviews or improvements could improve yields
- Pricing strategy – Adjusting rents thoughtfully to balance profitability and market competitiveness
- Communication with agents – Staying in close contact ensures proactive management and reduces vacancy periods
- Long-term planning – Considering the impact of legislative changes on future investments
Emma advises: “Strategic planning and proactive management are critical. Landlords who take time to understand the changes and adjust their approach will maintain a strong position in what could otherwise be a volatile market.”
Guidance for Tenants
Tenants will also need to adapt to the evolving market. With fewer properties available and rising competition, it’s more important than ever to:
- Act quickly when a suitable property becomes available
- Prepare all documentation for affordability and referencing checks
- Consider flexibility in location or property type to increase options
- Maintain clear communication with letting agents to stay informed about new listings
Tenants who are proactive and well-prepared are more likely to secure the right property in a tightening rental market.
Looking ahead
The Renters’ Rights Act and recent Budget changes are likely to have a lasting impact on Devon’s rental market. With supply tightening and competition increasing, both landlords and tenants will feel the effects over the coming months.
Emma concludes: “The sales market may have avoided major disruption this time, but the lettings sector is facing real challenges. Landlords will need support and strategic advice to navigate the changes, and tenants must act decisively to secure suitable homes. At Complete, our lettings team is ready to provide guidance, clarity, and support to help everyone make informed decisions.”
For landlords looking for a personalised breakdown of how these changes affect their portfolio, or tenants seeking guidance on navigating a competitive rental market, the team at Complete is always happy to help.
With expert local knowledge and hands-on experience, we can help landlords protect their investments and tenants find the right home, even in a challenging environment. Get in touch.
Want to find out more about the changes – from tenancy rules to eviction rights and property standards.? Watch our webinar.