According to a recent report by This is Money, the opening months of 2025 have seen a significant spike in landlords selling their properties. In January of this year, 17.4% of all new property listings (some 25,049 properties in total) across the country were former rental homes. This marks quite the leap from the previous year, where former rental homes accounted for only 11.7% of new listings.
While this might be considered a worrying trend for landlords and property management firms (not to mention tenants seeking places to live), it appears that London landlords aren’t so eager to ditch their properties.
In this article, we’re going to look at the reasons why so many former rental homes are on the market and why landlords in the capital are adopting a more cautious “wait and see approach”.
Issues affecting landlords
As you might expect, the key reasons for selling up rental properties, as cited by the landlords in question, are to do with financial matters and rental regulations. Some of the most common reasons given include the following:
Higher mortgage rates: with Britain still in a cost of living crisis and inflation not coming down as rapidly as hoped, interest rates on mortgages remain high and could go even higher. With many landlords operating on a slim enough profit margin, this can cause severe issues.
New legislation: the Renters’ Rights Bill is currently working its way through Parliament and includes several measures that curtail a landlord’s ability to choose who rents their properties – notably the abolition of ‘no-fault’ evictions. This potentially leaves them with a tenant that they cannot evict without a legitimate, legal reason.
Higher stamp duty: stamp duty on a rental property was already 3% higher than for a personal home, but late last year, the Chancellor decreed that this would increase further to 5%. Given how much house prices have increased, this is a significant addition to the cost of new rental properties.
Why London is different
Higher Rental Income Offsets Cost Increases: London’s rental prices are significantly higher than the rest of the UK, making cost increases less likely to impact landlords as severely. In 2025, the average London rent stands at £2,026 per month, compared to the UK average of £1,275. This price gap means that even with rising mortgage rates, maintenance costs, or tax changes, London landlords still generate substantial rental income. The higher baseline rent provides more financial cushioning, reducing the likelihood of landlords being forced to sell compared to those in lower-rent areas.
Greater chance of finding a tenant: London is home to thousands of businesses that employees are prepared to relocate to the capital to work for, and these people need somewhere to live, or they face a lengthy commute. Many workers in London receive higher salaries or location-based incentives to offset the higher cost of living. Employers often offer London weighting, bonuses, or other financial benefits to attract and retain talent in the capital. This means tenants are generally better equipped to afford the higher rents, ensuring a steady demand for rental properties.
More student accommodation: London has no fewer than 40 universities and colleges, attracting hundreds of thousands of students from around the world in need of accommodation. Since most student housing caters to several tenants per property, this remains a hugely lucrative market, despite financial and legislative changes.
Consider a Guaranteed Rent Scheme with Abel Living
If you’re a landlord in London, you may wish to consider a guaranteed rent scheme with Abel Living. These agreements ensure you receive a fixed rental income every month, regardless of whether the property is occupied or the tenant is paying. Even during void periods between tenancies, your income remains stable.
Guaranteed Rental Agreements for London Properties
If you’re looking to keep hold of your rental property portfolio in London, you can protect your investment with a Guaranteed Rental Agreement. Here at Abel Living, we have decades of experience in the rental industry and have partnered with hundreds of landlords across the capital to help them make the most of their rental properties. To arrange a free consultation with one of our experts, call the team today on 020 3924 4001.