One in five homes lost from PRS as small landlords struggle

More than 850,000 properties have left the private rented sector in the last decade as small landlords struggle with the Renters’ Rights Act, according to new data.

Findings by TwentyEA reveal one in five homes that were rented at some point in the last 10 years have since been sold and not returned to the rental market.

However, the data also shows rental supply is increasing, although small landlords are struggling to deal with additional legislation.

Landlords leaving the PRS

According to the data, more rental homes were sold after the Renters’ Rights Act came into force on 1 May.

TwentyEA reveals rental supply has increased by more than 17% so far in 2026 compared with 2025, but this is mainly down to purpose-built rental homes.

The research shows build-to-rent operators, with larger portfolios and dedicated management teams, are generally better placed to absorb additional regulatory requirements than smaller private landlords.

Nick Huntley, director of TwentyEA, said: “While it’s encouraging to see rental supply reach a seven-year high, that doesn’t tell the whole story.

“Many letting agents are still feeling the effects of landlords leaving the traditional PRS, reducing the stock they have available to market.

“The growth in purpose-built rental housing is helping to bring new homes into the sector, which is positive news for renters, but it complements rather than replaces the role of private landlords. The healthiest rental market is one where both parts of the sector are thriving and overall supply continues to grow.”

Rental market is still very busy

The data also reveals Wales and the Midlands experienced the highest price inflation, with Scotland, Inner London and the South East seeing more modest rises.

The East of England saw the largest price deflation, at 7.7% year-on-year, followed by Yorkshire and the Humber at 4%.

Demand has also risen across almost every region, with the exception of Inner London, reflecting continued pressure in the rental market. However, supply growth has outpaced demand, resulting in the number of homes available to rent increasing in 10 of the UK’s 12 regions, with only Yorkshire and Inner London bucking the trend.

Mr Huntley added: “The rental market is still very busy, but it’s becoming better balanced. Demand continues to grow in almost every region, yet supply is increasing even faster across most of the country.

“If that trend continues, it should gradually reduce the intense competition we’ve seen over the last few years and create a more stable environment for both renters and letting agents.”