More than one in four landlords who sold property over the past year did so with tenants in place, according to new research from Pegasus Insight.
The Landlord Trends Q4 2025 data shows that where properties were sold with sitting tenants, landlords typically sold an average of 1.8 properties.
Around 30% of properties sold by landlords were purchased by another landlord, indicating that some housing stock continues to circulate within the private rented sector.
However, a significant proportion of homes are leaving the rental market altogether, with 34% of sales going to first-time buyers and a further 29% to other residential buyers.
Taken together, the findings suggest that while some properties remain within the private rented sector following a sale, the overall trend points towards a gradual reduction in available rental homes.
Mark Long, founder and director at Pegasus Insight, said: “Landlord sales do not automatically mean a rental property disappears from the sector.
“In a meaningful minority of cases the property is simply being transferred from one landlord to another, and sometimes sold with tenants already in place.
“However, the overall direction of travel still points to a shrinking PRS. When a substantial proportion of landlord sales are going to first-time buyers or other owner occupiers, it inevitably reduces the pool of homes available for rent.
“Policymakers must recognise the cumulative impact of ever tighter regulation and rising taxation on landlords, particularly smaller operators.
“Many are deciding that the pressures and uncertainty are no longer worth it.
“This is significant because the PRS provides homes for around 20% of the UK’s households, so policy decisions affecting landlords ultimately have consequences for tenants too.”
