In the past, landlords who came into our Wimbledon office had actively chosen to invest in property, either as a full-time career or to benefit from long-term capital growth. It isn’t like that anymore. Now, many of our landlords are so called ‘accidental landlords’ who never intended to become a landlord but have found themselves needing to rent out a property they own.
The London rental market remains strong. According to the ONS Private Rent statistics (January 2026), around a fifth of all households in England live in the private rented sector, with average monthly rents in London reaching £2,253. So, renting out rather than selling your current home can be a great way to generate a regular extra income and benefit from capital growth when you come to sell.
Here we look at when renting out your home in South West London and Surrey makes sense, and what you should consider before taking the plunge – including critical new legislation taking effect in 2026.
To sell or rent – which is best? Most people expect to sell their current property before buying a new home. But another option is to hold onto the existing property and let it out. For some people, renting out their property could boost income and bring increased security in retirement.
Some people have no choice but to rent out their property. For instance, people who are temporarily working away but want to return to their home, or those who have been unable to sell but had to relocate for work.
Renting out your property, rather than selling your current home, could be the most sensible option if:
Here’s a closer look at some of the questions to consider when it comes to trying to decide whether to sell or rent out your property.
Firstly, you need to decide whether you can afford to keep your property and buy a new home at the same time. Do you have enough cash for a deposit for a second mortgage as well as stamp duty and legal fees?
Unless you own one of the properties outright, you will need to be able to afford repayments on two mortgages, one paid by your salary and one from rental income.
Talk to local letting agents in your area and research similar properties to yours on Rightmove and Zoopla to understand the tenants’ demographic in your area and the monthly rental you can expect. Do the maths: will the rent cover all your costs and allow for void periods? It may help to calculate your rental yield.
Consider whether your home needs any renovations to make it more appealing to tenants. This may mean you can charge more rent, but you will need to pay the upfront costs.
If you own a great property and believe that it will rise in value in the future, holding onto it can be an excellent investment. According to HM Land Registry data via Rightmove, the average property price in Wimbledon is approximately £820,907. While property values in South West London have seen modest growth recently, the long-term trend across the area continues to favour homeowners who hold.
Renting out your home isn’t as simple as finding a tenant and waiting for the money to roll in. Residential landlords have many obligations and responsibilities, which can result in hefty fines if not adhered to. This includes:
Unless you hire a letting agent to manage your property, you will also need to be on hand 24 hours a day, 7 days a week, if your tenants have an issue. Some tenants can be very demanding and expect you to fix minor problems with the property, which will take up a lot of your time and resources.
There is legislation that all landlords in the UK must comply with. It varies slightly between the four different nations. In England, for instance, landlords have to carry out Right to Rent checks. This isn’t the case in Scotland, Wales or Northern Ireland.
You will also have to ensure your property is safe in terms of getting electrical safety and Electrical Installation Condition Reports (EICRs) and annual gas safety checks. It should also be fire-risk compliant, meet minimum energy standards and be fit for human habitation under the government’s 2018 Act (this refers to, amongst other aspects, minimum room sizes). There is also particular legislation surrounding your tenant’s deposits.
From May 2026, the Renters’ Rights Act introduces additional compliance requirements, including mandatory written tenancy information, new restrictions on rent increases, and the upcoming requirement to register on the PRS Database.
The Renters’ Rights Act 2025 received Royal Assent on 27 October 2025 and represents the biggest reform to the private rented sector since the Housing Act 1988. Its core provisions come into force on 1 May 2026. If you are considering becoming a landlord, it is essential to understand these changes:
For full details and implementation dates, see the government’s guidance for landlords.
There are quite a few ongoing costs, in addition to your mortgage payments (which the rent should cover) that you will have to pay while you rent out your property. These include letting agent fees, an annual gas safety inspection, electrical safety checks, landlord insurance premiums and the cost of repairs and maintenance. You’ll have to get an EPC (which lasts for 10 years) and be able to afford to pay the council tax and the utility bills while the property is empty.
If your property has a mortgage, you will need to check with your mortgage lender that you are allowed to rent it out on your current mortgage. Your lender may grant you a Consent to Let, which allows you to let your property for a maximum of 12 months while maintaining your current mortgage. Otherwise, you will need to switch your residential mortgage to a buy-to-let mortgage. In this case, you will incur an arrangement fee, and the rate of the mortgage may differ from your current rate.
You must pay income tax on any profit you earn from rental property you own. This is the rental income you receive less any allowable expenses.
You should inform HMRC when you start renting a property, as you will probably need to complete a self-assessment tax return. Keep a record of how much rental income you receive and allowable expenses you incur in each tax year. See the HMRC guidance on allowable expenses for full details. Note that since April 2020, mortgage interest payments can no longer be deducted as an allowable expense; instead, landlords receive a 20% tax credit on mortgage interest.
Making Tax Digital (MTD): From April 2026, HMRC is rolling out Making Tax Digital for Income Tax Self Assessment. If your rental income exceeds £50,000, you will need to keep digital records and submit quarterly updates to HMRC using compatible software. Landlords with income above £30,000 will follow from April 2027.
If you decide to sell your property later, you will be subject to capital gains tax on the profit you made on the property since you rented it out. For the 2025/26 tax year, CGT rates on residential property are 18% for basic-rate taxpayers and 24% for higher or additional-rate taxpayers. The annual CGT tax-free allowance is now just £3,000 per person (down from £12,300 in 2022/23). You must report and pay CGT on UK residential property disposals within 60 days of completion.
Owning a buy-to-let property means that when you purchase another property, it will be classed as a second property, and you will be subject to higher rates of stamp duty tax. Since October 2024, the additional property surcharge has been 5% on top of standard SDLT rates (increased from the previous 3%). Combined with the lower nil-rate threshold of £125,000 that returned in April 2025, this significantly increases the upfront cost of purchasing an additional property.
All rental properties in England and Wales currently need a minimum EPC rating of E under the Minimum Energy Efficiency Standards (MEES). However, the government confirmed in its January 2026 Warm Homes Plan that all private rented properties must achieve a minimum EPC rating of C by October 2030, with a cost cap of £10,000 per property.
The EPC assessment framework itself is also being overhauled, with a new Home Energy Model due to replace the current SAP methodology. If you are considering letting your home, it is worth assessing your property’s current rating early and planning any upgrades required.
If you’re still unsure whether renting out your home is for you, or if it’s better to just go ahead and sell, here are some of the benefits as well as the pitfalls of renting out your home.
Legislation varies between the four nations in the UK so always check with the government website in which your property is located.
As well as checking with your lender if you need to change mortgage products, you will have to find a good letting agent. Next, take out landlord insurance to cover potential void periods. If you have an HMO or your property sits in an area with selective licensing in place, then check with the local authority if you do need a licence.
Get the deposit organised, an inventory and oversee the signing of the tenancy agreement (or get your agent to do these vital tasks on your behalf). From 1 May 2026, all new tenancies must include mandatory written information about the tenancy terms as required by the Renters’ Rights Act.
An estate agent can ensure that your rental property is compliant with current government legislation – including the new requirements under the Renters’ Rights Act – and that your tenants are being attended to in terms of repairs and maintenance issues. They will also make sure the tenant’s deposit is lodged in an appropriate government scheme.
A good estate agent will also carry out regular inspections of your property, collect rent and market your property when the current tenants move on. With the regulatory landscape becoming increasingly complex, professional management is more valuable than ever for accidental landlords.
These FAQs cover the most common questions we receive from accidental and first-time landlords in South West London and Surrey.
Rental values depend on your property type, size, condition and exact location. According to the ONS Private Rent data for London (January 2025 to December 2025), average monthly rents in London reached £2,253 as of January 2026, though South West London areas like Wimbledon, Raynes Park and Kingston typically command rents above the outer London average due to strong transport links and excellent schools. The best way to get an accurate figure is to request a free rental valuation from a local letting agent like Robert Holmes who knows the area well.
The Renters’ Rights Act 2025 is the most significant reform to England’s private rented sector since 1988. It received Royal Assent on 27 October 2025, with most provisions taking effect from 1 May 2026. Key changes include the abolition of Section 21 no-fault evictions, the replacement of fixed-term tenancies with periodic tenancies, restrictions on rent increases to once per year, a ban on rental bidding, a cap on advance rent to one month, and new anti-discrimination protections.
A mandatory PRS Database for landlord registration and a Private Rented Sector Ombudsman will follow in late 2026 and 2027.
However, as a new landlord, you’re actually at an advantage – so many measures are changing that it’s likelier to surprise experienced landlords who are used to operating under the old system (and organising their finances accordingly).
In most cases, yes. Your lender may grant a Consent to Let for short-term arrangements (typically up to 12 months), but for longer-term letting you will usually need to switch to a buy-to-let mortgage. Buy-to-let rates tend to be higher than residential mortgage rates. Always speak to your lender before marketing your property, as letting without consent could breach your mortgage terms.
You pay income tax on your net rental profit (rental income minus allowable expenses). You must register with HMRC for self-assessment and file an annual tax return. Mortgage interest is no longer deductible as an expense but qualifies for a 20% tax credit. From April 2026, landlords with rental income over £50,000 will also need to comply with Making Tax Digital requirements, keeping digital records and filing quarterly updates.
For the 2025/26 tax year, CGT on residential property gains is charged at 18% for basic-rate taxpayers and 24% for higher or additional-rate taxpayers, as confirmed by HMRC. The annual tax-free allowance is £3,000 per person. You may be entitled to Private Residence Relief for the period you lived in the property as your main home, plus the final nine months of ownership are always exempt regardless of use. You must report and pay CGT within 60 days of completion.
If you buy an additional property while retaining your rental, you will pay the standard SDLT rates plus a 5% surcharge on each band, as detailed on GOV.UK. Since April 2025, the nil-rate threshold for standard buyers has returned to £125,000. For example, purchasing a £500,000 property as a second home would attract approximately £40,000 in stamp duty. Non-UK residents pay an additional 2% surcharge on top.
Currently, all rental properties in England and Wales must have a minimum EPC rating of E. However, the government’s Warm Homes Plan confirmed that this will rise to a minimum of EPC C by October 2030, with a spending cap of £10,000 per property. The EPC framework is also being reformed in 2026 with a new Home Energy Model. If your property is currently rated D or below, it is worth planning improvements now to avoid disruption later.
Under the Renters’ Rights Act, landlords can still seek possession for rent arrears using Section 8 grounds, but the tenant must now be in at least three months’ arrears (previously two months). The notice period for rent arrears is four weeks.
Court proceedings take time, so having a robust tenant referencing process and rent guarantee insurance can protect your income. A good letting agent will manage arrears promptly and guide you through the legal process.
Yes, but you will need a valid legal reason. From 1 May 2026, all evictions must use Section 8 grounds. These include wanting to sell the property, moving back in yourself, rent arrears, and anti-social behaviour. Landlords must give at least four months’ notice for most grounds. The process requires following specific legal steps, which is why professional property management is increasingly important.
South West London remains one of the strongest rental markets in the UK. With average property values in Wimbledon around £820,907 (Rightmove, based on HM Land Registry data) and consistent rental demand driven by excellent schools, green spaces and fast transport links into central London, the area continues to attract high-quality tenants.
While the regulatory environment has become more complex, a well-managed rental property in this area can still deliver strong income and long-term capital growth. Working with an experienced local agent is the best way to navigate the new rules while maximising your return.
From the point of deciding to let your property, the process typically takes four to six weeks. This includes obtaining required certificates (gas safety, EICR, EPC), arranging landlord insurance, preparing the property for tenants, marketing and conducting viewings, referencing tenants, and signing the tenancy agreement. A letting agent can manage this entire process on your behalf and ensure everything is compliant before your first tenant moves in.
Standard home insurance does not cover you as a landlord. You will need specialist landlord insurance, which typically includes buildings insurance, landlord liability cover, and optional extras such as loss of rent cover, contents insurance, and legal expenses. Given the changes under the Renters’ Rights Act, rent guarantee insurance is also worth considering to protect your income during any arrears or void periods.
Robert Holmes have over 25 years of experience in residential lettings in Wimbledon and the surrounding area. We offer an unrivalled service for our landlords, many of whom are long-standing customers.
We provide both let-only and fully managed packages saving you precious time and giving you peace of mind that your property has great tenants and is well looked after. In other words, we can help whether you want to sell your home or rent out your property. Contact us now to find out more.
Ticking off the items on this list will help you keep track of your legal responsibilities when renting out a property.
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