How to sell a rental property in 2026

Savills released data on 1 May 2026, the day the Renters’ Rights Act came into force, estimating that 254,000 previously rented homes were listed for sale in the 12 months to the end of March. That works out at around 700 a day, 9% more than the year before and 28% more than two years ago. The trend is strongest in London, where former rentals made up 30% of new listings for sale, compared with 13% across the rest of Great Britain.

To put it into perspective, not all of these homes leave the sector: Savills found 14% of those sold were bought by other landlords, and describes the shift as a restructuring towards a smaller pool of committed landlords rather than a mass exodus.

For those landlords who are wondering how to go about selling a rental property, this blog post discusses the different ways landlords can approach going about it, taking into account the perspectives of renters. It’s a detailed post, but you can see the overview of topics below.

It also includes how selling a rental property works now the Renters’ Rights Act is in force.

PS If you’re not sure about selling and want to understand how to operate successfully under the Renters’ Rights Act, take a look at my bestselling book, The Good Landlord Handbook, published by Penguin.*

Why are landlords selling up in 2026?

It may seem difficult to understand why landlords want to sell up when rents and rental demand have never been higher. However, owning rental properties has become less profitable for landlords, particularly if they own their properties in their own names and not through a limited company.

Here are some of the reasons why landlords are selling in 2026:

1. Increased mortgage costs

Following the increases in the base rate, BTL mortgages cost considerably more than investors have been used to. They’re now around 4-5%, plus an arrangement fee. This is considerably higher than it was in 2022.

Consequently, it’s now harder for landlords to secure a BTL mortgage, without a high rent or opting for a lower loan to value.

2. The on-going impact of Section 24

Whilst the restriction of mortgage interest relief for landlords that was introduced by George Osborne under Section 24 of the Finance (No 2) Act 2015 was immediately unpopular, its effect was fairly limited while interest rates were low. However, with the sharp increase in base rates from 0.1% in December 2021 to 5.25% in August 2023, when unincorporated landlords came to the end of their fixed rate deals, they not only had to cope with higher financing costs, but were unable to set off the full amount against rental income.

Although base rates have eased to 3.75% (August 2026), the financial impact of Section 24 is one of the biggest reasons why landlords are looking to sell unprofitable buy to lets.

3. Concerns about the Renters’ Rights Act

The tenancy reforms in the Renters’ Rights Act came into force on 1 May 2026, and now regulate every stage of the tenancy process.

It brought into effect many provisions that are unpopular with landlords, such as the abolition of Section 21, the end of fixed terms, having to accept pets, the ban on rent in advance, and more complicated rules about increasing rent. The Act has been particularly concerning for landlords of student properties.

It is now more difficult to sell a property with vacant possession, although the new Ground 1A under Section 8 gives a landlord the right to apply for an order for possession after giving at least 4 months’ notice to expire on or after the first 12 months of a tenancy.

However, landlords won’t be able to re-let property or even put it on Airbnb during a “restricted period” of 12 months from the later of the date specified in the notice and the date when the claim form bringing proceedings for possession is filed at court. This is a minimum of 16 months from the date the notice is served.

This means landlords can no longer test the market. Instead, they need to price the property to sell, and be prepared to have an extended void.

>> Related Post: Grounds 1A and 1: How to evict tenants to sell up or move in

4. Concerns about an increase in capital gains tax

There are concerns that capital gains tax will be increased further and this would lower the net profit after tax that landlords could make from the sale of a rental property.

What landlords need to know if they’re thinking of selling in 2026

Landlords who are looking to sell need to be very realistic, and take the following into account:

>> Related Post: Guide to buying and selling property at auction

1. Expectations of higher asking rents

If a landlord is looking to sell to another landlord, in order to get the highest price for the property, the rent should be at or near the market.

However, average asking rents for new tenancies have increased significantly over the last few years, according to Rightmove. For instance, average rent outside of London has increased from £972 in Q4 2020, to £1,397 by Q2 2026.

If the seller hasn’t increased the rent since before the pandemic, there may be a big gap with the market rent. Depending on the situation with the tenant, this may impact the valuation.

2. Expectations of higher average yields

Investors looking to buy rental properties have expectations of higher yields as average yields have increased over the last few years.

For instance, the average across Great Britain (excluding London) increased from 5% in Q1 2022 to 6.6% by Q2 2026, according to Rightmove.

3. Competition from bank deposits

Even though the base rate has eased, would-be property investors might still be better off putting the money in fixed rate bank accounts. The yield from high interest bank accounts can rival the net cash flow from property, without the risk.

Sure, there’s no capital growth in the bank, but we may well be entering a period of stagnant house prices. For instance, the 2023 Joseph Rowntree Foundation report says “market stagnation is the most likely path for the next few years”.

4. Landlord sellers need to be realistic on price

If you’re determined to sell your rental property, the most important thing is to be realistic on price. This isn’t the market to test the waters with a high price, even if estate agents try to woo you with unrealistically high valuations.

If you price reasonably, you may get several offers. On the other hand, if the price is too high, it’s likely to hang around on the market and have to be reduced in price. This is even more so, now the Renters’ Rights Act is in force.

It is 2026 and not 2021, and sellers need to price accordingly.

Should a landlord sell with tenants or vacant possession?

One of the first questions that landlords need to answer when selling up is whether to sell the property with tenants, or with vacant possession.

If the priority is to sell for the highest price, then sadly for the renter, it’s more likely to be achieved with vacant possession.

Why is this? Selling with vacant possession means the property will appeal to the widest range of buyers. Not just other landlords.

Often buy to lets are the types of properties that attract first-time buyers, who also benefit from lower stamp duty. They might fall in love with a project and aren’t fixated on generating rental income. However, few first-time buyers would contemplate having to evict a tenant on their first property purchase. Therefore, to attract those first-time buyers who can afford higher rates, landlords need to sell with vacant possession.

When I sold my low-yielding rental flat in 2022, the buyer bought it to turn into serviced accommodation, for listing on platforms like Airbnb. This sadly meant that another property left the private rented sector. Click here for an overview of serviced accommodation.

What about selling a tenanted property to another landlord? This could work well if the renters are paying near market rent. However, if they’re not, the value to the investor will reflect this, as the example in the next section shows. Valuations are invariably higher if the property is sold untenanted, instead of with tenants in situ on a low rent. This in turn fuelled the increase in Section 21 evictions before 1 May 2026, and has been fuelling Ground 1A evictions since then.

>> Related Post: The Pros and Cons of Serviced Accommodation / Short-term Lets

The practicalities of selling a buy to let with tenants

There are some benefits when a landlord sells a buy to let property with tenants.

First and foremost, the renters keep their home, and the sale is not adding to the rental housing crisis. The seller won’t need to evict the tenants from their home, which is particularly difficult with good long-term renters. The seller also receives rent until the sale completes, and won’t have the worry of an empty property. The buyer knows exactly what the income will be, and that they’ll be responsible for future rent increases if it’s fallen behind the going rate.

Also, unless the buyer is a first time landlord, they’re likely to have a good understanding of conveyancing and the legal responsibilities of landlords. This is more likely to result in a smooth conveyancing process.

However, as I’ve seen myself when looking to add buy to lets to my portfolio, it’s not easy for landlords to sell with tenants. Access to the property for viewings can be difficult to arrange and the seller won’t be able to stage the property for sale.

The images above from a 2022 project prove this point. The top photo of the sitting room was in the estate agent’s listing for the sale of the property. The tenants’ oversized furniture meant it was very difficult to see the potential of the room, not least because the fireplace was behind the sofa. I took the bottom photo after the refurb from a different angle, when I listed it for letting. The refurbished room is clean and airy, and the lovely fireplace is the focal point, instead of the wrap-around sofa.

The seller did agree to sell the house with vacant possession, but it delayed the sale, as he needed to serve a Section 21 notice (this was in 2022, when it was still available). I wasn’t prepared to take the risk of buying a tenanted property, without a substantial reduction in the sale price, as it was only yielding 3.8%. To achieve a yield of over 6%, I needed to be able to refurbish the property to a high standard, which couldn’t be done with anyone living in the property.

The seller wasn’t prepared to drop the sale price to an amount that would enable me to keep the existing tenants, so he agreed to a sale with vacant possession. We exchanged and completed three days after the tenants moved out.

Although it’s hard for renters, it’s a question of economics for sellers. Selling with vacant possession reduces the buyer’s risk and helps the seller achieve the best price in a difficult market.

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Tips for selling a buy to let with sitting tenants

The best possible outcome from a wider societal perspective is to sell the property with tenants in situ.

Here are some practical tips for landlords who are considering selling a tenanted property and want to achieve a good price:

1. Increase rent towards the market rate

It’ll be easier to achieve a fair price with tenants in situ, if the rent isn’t far behind the market. This doesn’t mean increasing the rent all in one go, just before listing it for sale, as that may put your renters in financial difficulty.

It means increasing your rent at least in line with wage inflation each year, otherwise you are effectively reducing your rent.

>> Related Post: How to increase rents

2. Keep your tenants in the loop

It’s not compulsory to advise the tenants in advance of the sale. However, it’s best practice and it’s respectful to the renters. They’re also more likely to be cooperative if they feel they’re being treated fairly in the circumstances.

3. Be considerate when arranging viewings

It can feel very invasive to renters when potential buyers come to view the property. Estate agents should be considerate when arranging viewings, and try to group them into slots.

Legally, the renters’ right to quiet enjoyment continues, even when a property is on the market. The estate agent should give at least 24 hours’ notice of a viewing, and it should be at a reasonable time.

4. The buyer will inherit the tenancy agreement

Unless the tenant leaves the property before completion, any sale of the property will be subject to the existing tenancy. Make sure you can prove you sent the tenants the Information Sheet for the Renters’ Rights Act by 31 May 2026, if the tenancy was entered into before 1 May 2026.

However, it’s common for a new landlord to enter into a new tenancy agreement with the renters. They’ll need to ensure the renters have up to date documentation. (This means the EPC, EICR and Gas Safety Certificate). Any new tenancy agreement will need to be an Assured Periodic Tenancy, with the compulsory terms (or a separate written statement), now the Renters’ Rights Act is in force.

The rent will need to be apportioned if the sale completes on a date that is not a rent day.

5. What happens to the tenant’s deposit when a landlord sells up?

The contract of sale of the property should explicitly state that the deposit will be transferred to the buyer. The new landlord will be responsible for ensuring the deposit is protected, and serving the prescribed information within 30 days.

6. Serve correct notices to the tenants

Although it’s not compulsory to give advance notice of the sale to the tenants, the new landlord must provide notice of the sale within two months. The notice must include their name, address, and contact details. See Section 3 Landlord and Tenant Act 1985 for full details.

The new owner and landlord must also send a Section 48 notice to the tenants.

From a practical perspective, the new landlord will also need to do this to start receiving the rent, and advise the renters who is managing the property.

>> Related Post: What is a Section 48 notice?

7. The new landlord takes over legal obligations on completion

The new landlord is responsible for complying with landlord obligations, including any licensing requirements, from completion. The buyer should check the smoke and carbon monoxide alarms, and do a fire risk assessment.

The seller should obtain an up to date gas safety certificate and EICR to provide the buyer, if they don’t already have one.

>> Related Post: Fire safety rules for private landlords

How to get vacant possession when selling a rental property

Often the best option for the seller is a sale with vacant possession. Unless the sale coincides with the renters themselves deciding to leave, selling with vacant possession involves evicting renters.

What can a landlord do to help renters in this difficult situation? In a word, transparency.

Landlords should let the renters know informally that they’re thinking of selling well before serving the Section 8 notice. This is being fair to them, and will help them plan ahead, especially in taking on financial commitments.

It’s best to explain the reasons why, and reassure them that you’ll provide a good reference (if they merit it!) They might want to buy the property themselves.

Little things like being flexible on when the renters move out can make a real difference. For instance, if they find something earlier before the notice period expires, be generous, and release them. If they want to stay a few weeks after the notice expires to coincide with their move to another property, be flexible.

In terms of legalities, landlords should serve a Form 3A notice under Section 8 relying on Ground 1A, with at least four months’ notice, to expire after the first 12 months of the tenancy. As mentioned above, be aware that once you serve the notice, you cannot attempt to re-let it or market it for re-letting during the restricted period.

Do not attempt to persuade the tenants to move out, or ask them to leave, outside of the Section 8 process, as this will breach the duties in Section 16E of the Housing Act 1988 introduced by the Renters’ Rights Act. If a landlord or agent breaches these duties, the local authority can impose a civil penalty of up to £7,000. In some cases it will be an offence, in which case the maximum civil penalty will be £40,000, and the tenants can apply for a rent repayment order of up to two years’ rent.

>> Related Post: How to evict tenants using Section 8 with Form 3A

>> Related Post: Grounds 1A and 1: How to evict tenants to sell up or move in

Can landlords put property on market after serving a Ground 1A Section 8 notice?

Yes. Landlords can list a property for sale at any time, including after serving a Section 8 notice using Ground 1A. The restricted period that bans re-letting and marketing to re-let does not apply to marketing a property for sale.

However, unless or until the tenants move out, the property will be sold as tenanted, and not as vacant possession.

How to get ready for conveyancing

One of the most frustrating things about buying or selling property is the speed of the conveyancing.

However, there’s a lot you can do to get ready for the inevitable questions and requests for documents.

Here are some practical tips so you can get organised and hit the ground running on the sale of your buy to let:

• Ask your solicitor to send you the property information form, so you can have it ready to go.
• For leasehold property, ask your managing agent for the management pack. This should include the lease, any amendments and the last three years of service charge accounts. If it’s on a development, dig out the Certificate of Completion from Building Control.
• If you’re selling the property with tenants in situ, be sure to have everything up to date. This includes the Gas Safety Certificate, EPC, EICR, and the deposit registration information. Do also provide a copy of the latest tenancy agreement with any letters or Section 13 notices changing the rent and details of the service of the Information Sheet. (If your paperwork is not in order, this may limit your options, and you should get advice from a specialist solicitor.)
• If you’ve done any work on the property over the years, eg installing a new boiler or windows, retrieve the Building Control documentation.
• Find any guarantees for the property or the appliances.

>> Related Post: How to speed up conveyancing

Final thoughts

Buying and selling property is stressful at the best of times, even in a booming market. However, it’s even worse in a stagnant market.

Landlords looking to sell in 2026 need to have realistic expectations.

Of course, it’s very stressful for tenants when their landlord puts up their home for sale. Landlords should be sensitive to this, and be open, transparent and flexible with them, before and during the sale process. They should also try to sell the property with the existing tenants if at all possible.

Selling to another landlord with vacant possession at least means the property won’t be leaving the private rented sector. Otherwise, it’s one more eviction, one more set of renters looking for somewhere to live, and one more property potentially leaving the private rented sector.

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