The share of homes coming to market from landlords fell sharply in the first quarter of 2026, but the private rented sector is still losing stock because most of those homes are not returning as rentals after sale. New data from TwentyCi showed the proportion of former rental properties listed for sale dropped from 22.5% in Q1 2025 to 12.4% in Q1 2026 – a year-on-year fall of 45%.
That sounds like a calmer picture for the sector, and it may be. But the same report found only 6% of properties sold in Q2 and Q3 last year were later re-let outside London, rising to 11% in the capital. In other words, fewer landlords may be rushing for the exit, yet the stock already leaving the sector is still mostly being absorbed by owner-occupiers.
Fewer rental disposals do not mean supply has stabilised
London recorded the steepest fall in former rental sales listings, down 51%, with similar declines elsewhere in the UK. TwentyCi said new instructions across the wider housing market rose 5.1% year on year in Q1, while transactions were down 3.9% on last year but higher than 2023 and 2024 once the stamp duty distortion is stripped out.
Colin Bradshaw, chief executive of TwentyCi, said the market was “continuing to tick along nicely” despite wider disruption, though he also pointed to cooling in London and the South East as fixed mortgage rates moved back above 5%.
For landlords, that leaves an awkward split. The panic phase of the exit story may be easing, but replacement investor demand still does not look strong enough to refill the same stock once it has been sold.
This follows Residential Landlord’s recent coverage of landlords weighing exits before May, which suggested some investors were still acting ahead of the Renters’ Rights Act deadline. The latest TwentyCi figures add a useful check to that picture: exits may be slowing, but the sector is still shrinking underneath.
Affordability is still the main brake on any recovery
Another factor is price pressure on tenants. Residential Landlord’s report on asking rents stalling outside London showed affordability is already limiting what the market can bear. TwentyCi’s figures pointed the same way, with average rents edging down 2% to £1,450 a month even though they remain close to record highs.
The full TwentyCi Property & Homemover Report suggests the market is not seeing a clean landlord recovery or a clean exodus. Instead, it looks more like a drawn-out squeeze in which fewer investors list properties for sale, but the homes that do leave the sector are still not being replaced.
That matters more than the headline 45% drop. For investors thinking about expansion, the question is not whether fewer landlords are selling this quarter. It is whether the economics now support buying the stock that others have already given up.
Opinion
The landlord exit story has not vanished – it has just become less dramatic. That may suit politicians, but it does not fix the rental supply problem. If homes keep leaving the sector faster than they return, ministers will still be dealing with the same shortage by the end of the year.
