The PRS isn't just shrinking. It's consolidating. And the math explains why.
Allsop surveyed 1,000+ landlords last week. Two numbers:
62.5% of single-property landlords are reducing or exiting entirely. For landlords with 26+ properties, that drops to 36.8%.
This isn't regulatory squeeze alone. The economics of small BTL have been deteriorating for nearly two decades.
Before 2007, capital appreciation made everything else secondary. Modest yield, poor documentation, rising costs and all of it was covered by house price growth. Since 2007, real UK house prices have mostly fallen. The subsidy disappeared.
Then the tax structure shifted: mortgage interest fully deductible until 2017, now a 20% credit so landlords are taxed on gross income, not net. Many ended up in the 40% bracket on profit they weren't actually making.
Average rents are up 33%. Net profit is still down.
The ones staying have either incorporated or always ran it as a business. The accidental landlord was a product of a specific era. That era is over.
For renters: homes exiting the PRS tend to be at the affordable end, that helps FTBs. BTR replacement enters almost entirely at the premium end. The supply gap is real, and it falls hardest on renters who can't buy.