The cost of running rental properties has increased at more than twice the rate of rental income over the past five years, according to analysis of HMRC figures by Hello Neighbour.
Unincorporated landlords declared £34.75bn of allowable expenses against £58.99bn of rental income in 2024 to 2025.
That means costs were equivalent to 58.9% of rental income, up from 47.8% five years earlier.
Over the same period, declared expenses increased by 56%, from £22.33bn, while rental income rose by 26% from £46.69bn.
Finance costs were the largest expense recorded in the latest figures, reaching £12.82bn and accounting for 37% of total declared costs.
Around 1.15 million landlords reported residential finance costs, equivalent to an average of £11,148 among those making a claim, according to Hello Neighbour's calculations.
The figures come as higher borrowing costs continue to affect landlords, while the tax treatment of mortgage interest differs depending on how properties are held.
Since April 2020, individual landlords have been unable to deduct residential finance costs when calculating taxable rental profits. Instead, they receive a basic rate tax reduction equivalent to 20% of eligible finance costs. Limited companies are not subject to the same restriction.
Repairs and maintenance were another significant expense, totalling £6.41bn during 2024 to 2025.
Around 1.92 million landlords declared repair and maintenance costs, representing 66% of the landlord population covered by the figures. Hello Neighbour calculated an average cost of £3,339 among landlords claiming the expense.
Average rental income per landlord reached £20,500 during the year, while average declared expenses stood at £13,700.
In 2024 to 2025 alone, total expenses increased by 11%, while HMRC described total property income as "fairly consistent".
Phil Shelley, chair of Hello Neighbour, commented: "A sector housing a fifth of the country cannot absorb costs rising at twice the rate of income indefinitely. Landlords are being asked to fund upgrades the country wants through a tax system that treats them worse than a company holding the identical building. Policy needs a second setting that helps compliant landlords meet the standards rather than only penalising the minority who do not."
