Landlord sales slow as 12-month re-letting ban makes selling more difficult

For the first time in seven years, landlord purchases exceeded landlord sales as 12-month re-letting ban deters landlords from selling, according to new research.

Data from Hamptons reveals the share of homes listed for sale that were previously rented dropped to 9.2% nationally in June, down from 11.3% last year and below the 2021-2022 peak.

The estate agent says a spike in landlords selling before the Renters’ Rights Act came into force in May, along with a tougher sales market and the introduction of a 12-month re-letting ban, has reduced the number of landlords putting their properties up for sale.

Under the Renters’ Rights Act, landlords who evict tenants in order to sell a property, but whose sale then collapses, must wait 12 months before re-letting it.

Complicated proposition for landlords

Aneisha Beveridge, head of research at Hamptons, explains: “The Renters’ Rights Act has been a long time coming, and most landlords who wanted to leave the sector because of it have probably already done so.

“While the new rules may have encouraged some landlords to sell, the bigger shift has come from years of tax changes and higher mortgage costs, which have gradually reduced the number of landlords in the market.

“What’s changed more recently is the balance of risk.  A tougher sales market and the introduction of a 12-month re-letting ban mean selling has become a more complicated proposition for landlords.

“For many, the prospect of being left with an empty property that can’t easily return to the rental market has made holding on to an investment look more attractive.”

Hamptons warns the 12-month re-letting ban could leave up to 100,000 rental homes in limbo.

Analysis of landlord sales in 2025 found that 51% failed to complete, rising to 60% for flats, potentially removing tens of thousands of homes from the rental market for a year.

PRS not kept pace with wider housing market

The data also shows that a slower sales market is making landlords more cautious about selling. Across Great Britain, 24.4% of flats listed for sale in June had previously been rented, compared with just 7.8% of houses.

Hamptons says both investors and owner-occupiers have become more cautious about flats, partly due to rising service charges.

This is reflected in longer selling times, with the average flat taking 85 days to go under offer in June, almost a month longer than a house at 59 days.

The findings also show that the private rented sector has not kept pace with the wider housing market. The number of rental homes in England has remained broadly unchanged at 4.8 million over the past decade, while the total number of homes has grown by around 2 million.

Most of this additional housing stock has instead moved into owner occupation.

Positive rental growth

However, there are some positive signs in the rental market, with growth in rents on newly let homes continuing to pick up.

Rental growth has been edging higher over the past six months, with the average rent on a newly let home across Great Britain reaching £1,392 per month in June, 1.6% higher than a year earlier. This marks the strongest annual growth for new lets in 13 months.

The recovery has been driven by northern markets, where rents are rising fastest. The North East recorded the strongest growth, with newly agreed rents up 4.3% year-on-year to £859 per month. By contrast, rental growth in Inner London continued to slow, falling from 1.6% in May to 0.4% in June.

However, Outer London returned to positive annual growth for the first time in 12 months, with rents rising 1.9% year-on-year.

Across the wider rental market, including both new lets and existing tenancies, rents increased by 2.2% year-on-year.

Ms Beveridge added: “For those landlords who have chosen to sit tight, there are signs that their decision may start to pay off. Yields have improved over the last couple of years as rents have risen faster than house prices, giving investors more headroom to absorb higher borrowing costs.

“At the same time, rental growth is picking up again, with rents on newly let homes rising at their fastest pace in more than a year. While challenges undoubtedly remain, conditions for landlords arguably look better than they did 12 months ago.”