A growing number of homes that were once part of the private rented sector are now being listed for sale, as landlords across the UK continue to reassess the long-term viability of buy-to-let investing. New analysis from Savills suggests this is not a short-term shift, but part of a wider structural change in the rental market.
Rising number of former rental homes hitting the market
According to Savills, around 254,000 properties that were previously rented out were placed on the sales market in the 12 months leading up to the end of March. This equates to approximately 697 homes being listed for sale every single day.
The figures show a noticeable increase in activity compared with previous years. Listings of former rental homes are up around 9% year-on-year and stand roughly 28% higher than levels recorded two years ago. This steady rise suggests more landlords are either exiting the sector entirely or scaling back their portfolios.
While some of this movement reflects normal market turnover, the scale of change points to deeper pressures influencing landlord decision-making.
London leading the trend
The shift is particularly pronounced in London. Savills data indicates that nearly a third of all new property listings in the capital over the period were previously used as rental homes.
This is a significantly higher proportion than the rest of the UK, where former rental properties accounted for around 13% of new listings. The contrast suggests that landlords in London may be feeling the combined impact of higher property values, regulatory pressures, and changing rental yields more acutely than elsewhere.
Why landlords are reconsidering their positions
Industry experts at Savills say several factors are contributing to the growing number of sales. One of the most significant is the introduction and ongoing development of the Renters’ Rights Act, which has prompted many landlords to reassess how attractive the sector remains.
At the same time, a large number of fixed-rate mortgage deals are coming to an end, meaning landlords are facing higher borrowing costs as they refinance. This is being compounded by wider regulatory changes, including increased expectations around minimum energy efficiency standards for rental properties.
Taken together, these pressures are forcing many landlords—particularly smaller, mortgaged investors—to take a closer look at whether holding onto rental properties still makes financial sense.
Lucian Cook, Head of Residential Research at Savills, explained that the Renters’ Rights Act has become a key milestone for many landlords when reviewing their portfolios. He noted that rising mortgage costs and regulatory requirements are adding further strain, leading to more fundamental decisions about whether to remain in the sector.
Use of Section 21 notices and market testing
Savills also highlights a rise in the use of Section 21 notices, which allow landlords to regain possession of a property without needing to provide a specific reason under current rules.
In some cases, these notices are being used as a way for landlords to test the open market and assess what rental levels they could achieve if they were to relist the property. However, Savills suggests that a proportion of these homes are ultimately expected to be sold rather than retained as rental investments.
This behaviour reflects a broader level of uncertainty among landlords, many of whom are weighing up whether to continue letting or exit while market conditions remain favourable.
Not all homes are leaving the rental sector
Despite the increase in listings, Savills points out that not every former rental property is leaving the sector entirely. Around 14% of homes sold during the period were purchased by other landlords, meaning they have remained within the private rented market under new ownership.
This indicates that while some landlords are exiting, others are taking the opportunity to expand or restructure their portfolios. In many cases, properties are simply changing hands rather than being permanently removed from the rental supply.
What is driving future sales activity
Looking ahead, Savills expects two key factors to play a major role in shaping future trends: refinancing pressures and tenant movement.
As more fixed-rate mortgage deals expire, landlords may face increased monthly costs, prompting further reviews of investment performance. At the same time, tenant turnover is likely to influence decisions around whether to re-let or sell properties.
Nicholas Gibson, Research Analyst at Savills, says the market is not simply shrinking but evolving. He explains that while some homes are returning to the sales market, others are being bought by different landlords, leading to a gradual restructuring rather than a straightforward contraction of supply.
A shifting rental landscape
Overall, the data suggests the private rented sector is undergoing a period of adjustment rather than abrupt decline. While the number of landlords selling up is rising, the sector is also seeing continued reinvestment from others, particularly more professional or larger-scale investors.
This is leading to a gradual shift in the composition of the market. Instead of a broad base of smaller landlords, the sector may increasingly be shaped by a smaller number of more committed operators who are better positioned to absorb regulatory and financial pressures.
For now, the trend highlights a market in transition, where decisions are being shaped by a combination of policy changes, borrowing costs, and long-term confidence in the rental sector.
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