Landlords’ sell-off may be coming to an end

The wave of residential landlords exiting the property market appears to be slowing, according to new research from property data firm TwentyCi. Fresh figures suggest the proportion of former rental homes being listed for sale has fallen sharply during the past year, hinting that the long-running buy-to-let sell-off may be reaching its peak.

At the start of 2025, ex-rental properties made up 17.4% of homes on the market. Recent data shows that figure has now dropped to around 10.4%, bringing it much closer to the long-term average. The shift suggests that the surge in landlords selling properties — a trend that has significantly affected rental supply in recent years — may now be stabilising.

Why landlords were leaving

The buy-to-let sector has faced sustained pressure over the past decade. A combination of tighter regulation, rising interest rates, reduced tax relief, and increasing compliance requirements has significantly altered the economics of property investment.

Key pressures have included:

• Restrictions on mortgage interest relief
• Higher stamp duty on additional properties
• Increasing regulation and compliance costs
• Energy efficiency requirements
• Higher borrowing costs following interest rate rises

These factors disproportionately affected older or smaller landlords, many of whom chose to exit the market rather than adapt to the new landscape.

At the same time, fewer new investors have been entering the sector, as the returns no longer appear as attractive compared with alternative investments.

What the new data suggests

The fall in ex-rental listings suggests that the most motivated sellers may already have left the market. In simple terms, the large backlog of landlords looking to sell has started to clear.

This does not necessarily mean landlords are returning in large numbers. Instead, the data indicates the market may be moving towards a new equilibrium where:

• The remaining landlords are more professional and long-term focused
• The pace of exits is slowing
• The supply shock from landlord selling is easing

For the housing market, this could signal a shift away from the unusually high level of rental stock being converted into owner-occupied homes over the past few years.

Implications for the rental market

A stabilisation in landlord selling does not immediately solve the wider rental supply problem. Rental stock remains constrained after several years of landlords exiting and limited new investment entering the sector.

However, the slowdown in sales could help prevent further sharp reductions in rental supply. Over time, this may reduce upward pressure on rents if the number of available rental properties begins to stabilise.

A turning point for buy-to-let?

The data suggests the buy-to-let market may be transitioning into a new phase. Rather than a mass exodus, the sector could now be evolving into a smaller but more professionalised landlord base operating under tighter regulation and different financial expectations.

While challenges remain, the steepest phase of landlord selling may now be behind us.