Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.

Hamptons: Up to 100,000 Unsold Ex-Rental Homes Could Remain Empty

Research by Hamptons indicates that up to 100,000 unsold ex-rental homes could be left empty due to the Renters’ Rights Act. The agency’s analysis highlights a slowdown in landlords selling properties, but warns that new rules may prevent many homes from returning to the private rented sector.

Hamptons, using data from Connells, found that the proportion of homes listed for sale that were previously rented dropped to 9.2% in June, down from 11.3% last year and below the 2021-2022 peak. June also marked the first time since 2019 that landlord purchases outpaced landlord sales.

The Renters’ Rights Act, which came into force in May, introduces a mandatory 12-month ban on re-letting properties where a Ground 1A notice to sell has been served, even if a sale falls through. Hamptons estimates that, based on last year’s market, between 80,000 and 100,000 unsold rental properties would have been prevented from returning to the rental market under these new rules.

The agency attributes the slowdown in landlord sales partly to many landlords having already exited the sector in response to tax changes, higher mortgage rates, and other reforms in recent years. Weaker sales conditions, particularly in southern England, are also making landlords more cautious about selling, as higher prices, lower yields, and slower transaction times increase the risk of properties remaining empty.

Flats are especially affected, with 51% of rental homes marketed for sale last year being flats. In June, 24.4% of flats listed for sale across Britain had previously been rented, compared to 7.8% of houses.

Hamptons also reports that rental growth is strengthening. Average rents agreed on newly-let homes rose 1.6% year-on-year in June to £1,392 per month, the fastest annual growth recorded for 13 months. Across the wider rental market, including existing tenancies, rents increased by 2.2% annually, while existing tenants who saw their rent increase experienced an average rise of 5.4%.

These findings are relevant for letting agents and inventory clerks monitoring the impact of legislative changes and market trends on rental stock and property turnover.