Selling a rental property changed materially on 1 May 2026, when the Renters' Rights Act came into force and Section 21 "no-fault" evictions ended. Landlords can still sell - but how you do it, and whether you sell with tenants in place or empty, now follows new rules. This guide explains both routes in 2026.
The two ways to sell a rental
You can sell a tenanted property in one of two ways. The first is to sell with tenants in situ - that is, with the tenancy continuing. The buyer, almost always another landlord or investor, takes on the property and inherits the tenancy: all of your rights and obligations under the agreement transfer to them, the tenant stays, and there is no notice to serve and no void period. It is usually the faster, cleaner route, and since 1 May 2026 it has become the default way many landlords exit.
The second is to sell with vacant possession - the property empty. That now requires using a valid ground for possession, because Section 21 is gone. The relevant one is Ground 1A, the selling ground, and it comes with conditions.
Selling with vacant possession: Ground 1A
To regain possession in order to sell, a landlord uses Ground 1A under the Renters' Rights Act. The key conditions: you must give at least four months' notice; you cannot use the ground in the first 12 months of the tenancy (the notice can be served earlier, but it cannot expire until the tenant has been in the property for 12 months); and once you have taken possession this way, you normally cannot market the property for let or re-let it for 12 months. Since 1 May 2026 all former assured shorthold tenancies have become assured periodic, rolling tenancies, so there is no fixed-term end date to rely on.
Who buys tenanted property
Tenanted stock sells to a particular kind of buyer: other landlords and portfolio investors who want immediate rental income with no void. That is a smaller pool than the open market, so a tenanted sale can take a discount - but it avoids the lost rent, the notice period and the re-let restriction that come with emptying the property first. Cash and portfolio buyers dominate this market, which is also where many landlords selling up meet their exit.
The tax when you sell
Selling a buy-to-let is a capital-gains event. For residential property the rates are 18% within your unused basic-rate band and 24% above it, after the £3,000 annual exempt amount, and you must report and pay within 60 days of completion. What you can deduct, and the reliefs that may apply, are in our guide to CGT on a buy-to-let.
Sell in situ, sell empty, or hold?
The decision usually comes down to speed and price against the new restrictions. Selling in situ is fastest and keeps the rent flowing until completion, at a likely discount to vacant value. Selling empty may reach more buyers and a higher price, but means four months' notice at least, lost rent, and a 12-month re-let bar if the sale falls through. For many landlords weighing the 2026 rule changes, the wider reasons to sell tip the balance.
Frequently asked questions
Can I sell my rental property with tenants still in it?
Yes. You can sell with tenants in situ: the tenancy and all your obligations transfer to the new owner, the tenant stays, and no notice is needed. The buyer is usually another landlord or investor.
How do I get vacant possession to sell in 2026?
Since Section 21 ended on 1 May 2026, you use Ground 1A, the selling ground: at least four months' notice, not usable in the first 12 months of the tenancy, and you cannot re-let for 12 months after taking possession.
Is it better to sell a rental with tenants in situ or empty?
In situ is faster, avoids void periods and keeps rent flowing, but sells to a smaller pool of landlords and investors, often at a discount. Empty may reach more buyers and a higher price but means notice, lost rent and a re-let restriction if the sale falls through.
Do I pay capital gains tax when I sell a rental?
Yes, on the gain, at 18% or 24% for residential property after the £3,000 allowance, reported and paid within 60 days of completion. See our buy-to-let CGT guide.