Landlord exit risk because of Renters’ Rights Act

Two in five landlords are unlikely to continue letting homes following the implementation of the Renters’ Rights Act, according to new data.

Research by property consultancy firm Allsop found that 41% of landlords said they are unlikely or very unlikely to continue letting, rising to 51% among single-property landlords, following the abolition of Section 21.

The findings come as the Renters’ Rights Act came into force on 1 May 2026.

Smaller landlords are exiting

According to the data, nearly a third of landlords (30.3%) said they plan to sell all of the homes they let out, with a further 18% planning to reduce the number of homes in their portfolios (representing a combined 48.4% of landlords who are planning to reduce their exposure to or exit the sector)

More than 70.3% of landlords said they would respond to increased compliance costs by raising rents, while a further 23.2% said they would sell their properties.

Seb Verity, head of research at Allsop, said: “England’s private rental sector isn’t simply shrinking, it’s also consolidating. Smaller, often accidental landlords are exiting while larger, more institutional operators are selectively holding or growing.

“The Renters’ Rights Act looks likely to succeed in its ambitions to professionalise the private rented sector and to drive up standards, which is certainly to be welcomed. Greater security of tenure and clearer redress mechanisms are a good thing.

“But the cumulative weight of regulatory change, layered on top of mortgage rate rises, tax reform and EPC obligations, is testing the resolve of a large cohort of smaller landlords, many of whom provide well-managed, good quality homes for families and many of whom seem no longer to feel they’ll be able to continue doing so.”

“This will increase the cost of renting at a time when simply too few homes are being built to meet our housing needs.”

An open question

Mr Verity adds: “The Renters’ Rights Act represents the latest transformation of England’s housing stock. Whether that structural shift ultimately serves tenants well remains an open question.

“Much of what it seeks to do is welcome but, in the absence of a more effective strategy in parallel to increase housing supply and affordability, it may well end up serving only to add to or compound existing housing challenges.”

The data also reveals 44% of landlords with 26 or more properties plan to increase or maintain their investment levels over the coming years, compared to just a quarter (25%) of single-property landlords.