Over 25% of UK Landlord Property Sales Include Sitting Tenants, New Data Shows

Summary: Recent research reveals that more than one in four UK landlords sold properties with tenants still in situ over the past year, highlighting a trend of tenant occupancy continuing despite ownership changes. This has significant implications for the private rented sector (PRS), which is shrinking as many properties are sold to owner-occupiers rather than remaining as rental homes.

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More Than a Quarter of Landlord Sales Involve Tenants Remaining in Place

New data from the Pegasus Insight Landlord Trends survey reveals that over 25% of landlords who sold a property in the last year did so with tenants still occupying the home. On average, landlords sold 1.8 properties with sitting tenants, indicating that tenant occupancy often continues despite changes in ownership.

Furthermore, around 30% of these properties were purchased by other landlords, suggesting a significant proportion of rental homes are transferred within the private rented sector rather than exiting it entirely.

Private Rented Sector Continues to Shrink

Mark Long, founder and director of Pegasus Insight, explains that landlord sales do not always mean a property leaves the rental market. “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,” he said.

However, Long emphasises that the overall trend points towards 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.”

This reduction in rental stock is significant given that the PRS currently provides homes for approximately 20% of UK households.

Owner-Occupiers Account for Majority of Purchases

The research highlights that while 30% of sales remain within the landlord community, a larger share of properties sold by landlords are acquired by buyers intending to live in them. First-time buyers accounted for 34% of purchases, with an additional 29% bought by other residential buyers.

These transactions effectively move homes out of the lettings market, further reducing the availability of rental properties for tenants.

Policy Implications for Landlords and the PRS

Mark Long warns that the cumulative effect of tighter regulation and rising taxation is driving many landlords, especially smaller operators, to exit the market. “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,” he said.

Given the PRS’s role in housing one-fifth of UK households, policy decisions affecting landlords inevitably have consequences for tenants, underlining the need for balanced regulation that supports the sector’s sustainability.

What This Means for UK Landlords

For landlords, the data suggests that selling properties with tenants in place is a common and practical strategy, potentially easing transitions and maintaining rental income streams. However, the broader trend of properties moving into owner-occupation highlights challenges in maintaining rental stock levels.

Landlords should be aware of the regulatory and tax pressures influencing market dynamics and consider how these factors might affect their investment decisions and portfolio management.

Contacting Experts for Landlord Property Sales

Landlords considering selling rental properties, particularly with tenants in situ, may benefit from consulting specialist agencies experienced in navigating these transactions efficiently.

Suggested internal link anchors

• private rented sector
• landlord property sales
• tenants in place
• landlord taxation
• rental property availability
• first-time buyers
• regulation impact on landlords
• landlord investment decisions
• tenant occupancy
• smaller landlord challenges

TLA update

TLA is launching a new Trusted Partners Hub in Q1 2026, featuring verified and approved service providers selected to support landlords, tenants, and property management businesses. We are inviting legal, trades, insurance, financial, mortgage, tenant screening, and other service providers to register their interest here: https://landlordassociation.org.uk/become-a-tla-service-partner/