Selling a rental property has become “too much of a risk” under the Renters’ Rights Act, according to one property sector specialist, after recent figures showed landlord purchases overtook sales for the first time since 2019.
Mark Dawson, managing director of landlord adviser and eviction specialist AST Assistance, said the introduction of a 12-month ban on re-letting a property after using a Ground 1A notice to evict a tenant in order to sell had removed an important safety net for landlords.
His comments follow analysis by Hamptons showing landlords accounted for 10.2% of property purchases in June, compared with 9.2% of homes listed for sale that had previously been rented – the first time since 2019 that purchases have exceeded sales.
Dawson said: “The 12-month re-letting ban has taken away a huge safety net for landlords. It’s no longer the case that they can just re-let if their sale falls through, placing them in a situation where it’s too much of a risk to try and sell their property.”
Dawson added this was especially the case when considering more than half (51%) of rental properties failed to complete sales in 2025.
He said: “In some cases this risk can leave a property sitting empty for 12 months, not only taking away a landlord’s income, but also leaving them paying mortgage payments, utility charges and council tax.”
According to Dawson, landlords choosing to sell now needed a much firmer plan in place, including finding buyers who were less likely to pull out if the eviction process is delayed – “either someone who has already had an accepted offer on their own property or a first-time buyer with a mortgage already agreed”.
Dawson also questioned whether the rules could have unintended consequences for the private rented sector.
“If landlords delay both selling and re-letting to avoid the 12-month penalty, homes sit empty on both sides of the market, not benefiting buyers or renters,” he said.
“Ultimately, this could end up working against the very people the Renters’ Rights Act was designed to protect.”
Comments (6)
If opposition party/ies were to indicate a full reversal of Labour policies if Labour are displaced in the GE in 2029, that may help landlords to `tough it out` until then. It could be the new administration do not repeal the laws so a commitment now would benefit.
I believe REFORM UK have made that commitment.
Some thoughts from my experience as a landlord and a property lawyer.
1. If there weren’t so many ways for landlords to trip up and be fined for minor infractions, sales with tenants in situ would be much easier and there would be more of them. This would benefit tenants as well as they would not have to leave when a landlord wanted to sell.
2. The market could adapt by landlords selling conditionally upon vacant possession being given, with a long stop date and, perhaps, the seller compensating the buyer for wasted legal and survey fees if vacant possession cannot be given because the tenant fails to leave.
3. In the case of 2 above, landlords could offer tenants a financial incentive to leave on the strict condition they vacate on or before a specified date.
Unfortunately the thrust of legislation for the last ten years has been: How can we make it as difficult as possible for landlords to get their properties back? How can we penalise them harshly for trivial mistakes and now with the RRA, penalise them for what in other spheres of business is standard practice? This Government and the (allegedly) Conservative previous one, have created a hostile environment for landlords which has not really helped most tenants.
Offering tenants incentives to leave is all very well but may not stand well with any future landlords. If Burnham goes ahead with replacing council tax with land tax only paid by home owners, tenants exempt, I can foresee thousands of evictions. Landlords and second home owners will pay double land tax. Today rents just do not cover the cost for landlords to pay land tax on their rentals. I also read that landlords will not be allowed to increase rents to cover this.
One of the biggest issues with selling with tenants in situ is that every time a new landlord takes over, they have to pay a prohibitive stamp duty levy that basically wipes out any money they might make for a number of years.
Consider a modest £200K tenanted house being sold. Selling with a tenant in situ would cost any new landlord £11,500 in stamp duty, plus legal fees of £1500, for a total of £14,000, which is equivalent to 10 months’ rent. Given that mortgage and other costs may swallow up much of that rent, it could take years to break even, so nobody in their right mind would do it unless they bought at a steep discount.
Or you could just evict the unfortunate tenant who has done nothing wrong apart from being a victim of the war on landlords, and sell for more or less full market value to a first time buyer for zero stamp duty or to a subsequent buyer for just £1500 duty. Or hold out in the hope that the tenant decides to move on sooner or later.
The numbers are far worse in London and the home counties, with a £400K house attracting an astonishing £30,000 stamp duty, making it financially ruinous to keep the tenant.
There should be a relief system where the new landlord gets a waiver for keeping the tenant in situ or otherwise continues to rent it out for at least 5 years. That way the landlord would not be forced to evict their tenants whether they like it or not.
It’s an absolutely inhuman and insane system. Thanks, George. I hope you and your successors are proud of all the people you have made homeless over the years in your quest to force landlords out of the market.
Many landlords are waiting until their tenants give notice, then selling when the property is empty. That avoids the 12 month no re-letting rule. They are also aware that properties need to be priced correctly and not overvalued.