The UK’s private rented sector (PRS) has experienced its largest drop in value this century, according to new analysis from property consultancy Savills.
The data shows that the value of the PRS fell by £48 billion in 2025 alone. At the same time, the value of owner-occupied housing increased significantly, rising by about £185 billion during the same year.
Savills’ research, which examines the overall value of the UK housing market, indicates that the rental sector is currently the only housing tenure that has been shrinking in recent years. While the wider housing market has continued to grow, the PRS has been contracting for three consecutive years.
Since 2022, the total value of the private rented sector has fallen by around £79 billion, representing a decline of approximately 5.1%, even though the total value of UK housing increased during that period.
One of the main reasons for the fall is a reduction in the number of rental properties available. Although house prices have increased in many areas, this growth has not been enough to offset the loss of properties from the rental market.
Industry experts say the shrinking supply is largely due to landlords selling their properties or leaving the sector altogether. Rising costs, taxation changes, and new regulatory requirements have made buy-to-let investments less attractive for some property owners.
The continuing decline of the private rental sector could have wider implications for the housing market. If fewer properties remain available to rent, tenants may face increased competition for homes and potentially higher rental costs.
With the rental market already under pressure, analysts warn that further reductions in landlord participation could continue to reshape the sector in the coming years.
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