There has been a sharp rise in the number of former rented homes being put on the sales market, as landlords reassess their position, says Savills.

The upmarket estate agency estimates that 254,000 previously let buy-to-let homes were listed for sale in the 12 months to the end of March, the equivalent of 697 properties every day.

That is 9% higher than the previous year and 28% above the levels of two years ago.

The sell-off is most pronounced in London, where former rental properties accounted for almost a third of all new sales instructions over the period, compared with 13% in the rest of the country.

For many landlords, the Renters’ Rights Act has become a clear point at which to reassess their investment.”

Lucian Cook, Head of Residential Research at Savills, says: “For many landlords, the Renters’ Rights Act has become a clear point at which to reassess their investment.

“This has been compounded by fixed-rate mortgages coming to an end and wider regulatory pressures, including higher minimum energy efficiency standards.”

“Together, these factors are driving a more fundamental review of whether rental property still stacks up, particularly for smaller, mortgaged landlords.

Test the market

There has also been a notable increase in Section 21 notices being served, which Savills says is often a way for landlords to test what rents they can achieve in the open market, although it expects this to translate into more sales in the coming months.

Despite the rise in listings, Savills points out that not all homes are leaving the sector – 14% of the properties sold were purchased by other landlords.

Looking ahead, the estate agency says refinancing and tenants choosing to move on are likely to become the main sales triggers.

Nicholas Gibson, Research Analyst at Savills, adds: “With a significant number of homes returning to the rental market under new ownership, it is not just about shrinking supply, but a broader restructuring of the market towards a smaller, more committed pool of professional landlords.”