Private Rented Sector (PRS)
The private rented sector (PRS) is the classification used by the Ministry of Housing, Communities and Local Government to describe housing that is owned by private individuals or companies and let out to tenants under residential tenancy agreements, as distinct from owner-occupied homes and social housing. In England in 2024–25, the PRS comprised approximately 4.7 million households, around 19% of all households, with around 11 million people renting from approximately 2.3 million private landlords, according to the government's Guide to the Renters' Rights Act. It is the second-largest housing tenure in England after owner-occupation, and has roughly doubled in size since the early 2000s.
Structure of the sector
The PRS is not a monolithic market. It encompasses a wide range of property types, landlord types, and tenancy arrangements.
Most private landlords are individuals letting a small number of properties. The English Private Landlord Survey 2024 found that 45% of all landlords owned just one rental property, while 94% of the sector is made up of landlords with fewer than five properties. These small-scale individual landlords account for the majority of the sector by landlord count, though portfolio landlords, those owning five or more properties, account for a disproportionate share of tenancies (49% of the total according to the 2024 survey).
Alongside individual landlords, a growing share of the PRS is owned and operated by institutional investors through Build to Rent (BTR) developments, purpose-built blocks of flats held for rental rather than sale, operated by professional management companies. BTR represents a more professionalised sub-sector, typically offering longer tenancy terms, in-building amenities, and dedicated management staff. Although BTR has grown rapidly, it remains a small fraction of the total PRS.
The PRS sits alongside social housing, which is provided by councils and housing associations and operates under different legislation, regulated rents, and a separate ombudsman framework. A tenant who rents from a council or housing association is a social tenant; a tenant who rents from a private individual or company landlord is a private tenant.
The regulatory framework
The PRS is among the most heavily regulated parts of the housing market. Every private landlord letting on a residential tenancy in England must comply with a framework that spans contract law, housing law, health and safety law, tax law, and anti-money laundering regulations.
Core obligations include protecting any tenancy deposit in a government-approved scheme within 30 days and serving the prescribed information on the tenant; conducting Right to Rent checks on all adult occupiers before the tenancy begins; providing a current Energy Performance Certificate; carrying out annual gas safety inspections and retaining the certificate; commissioning an Electrical Installation Condition Report at least every five years; providing a working smoke alarm on every floor and carbon monoxide alarms where required; providing the current How to Rent guide in England; and complying with the Tenant Fees Act 2019 on what can and cannot be charged to tenants.
Additional obligations apply in specific circumstances, mandatory HMO licensing for larger houses in multiple occupation, selective licensing in designated local authority areas, and registration requirements for landlords holding certain non-assured tenancies.
From working with self-managing landlords across the UK, the compliance framework is the single most underestimated aspect of PRS letting for new landlords. The obligations are not optional, do not reduce with time, and carry meaningful penalties. August is built for landlords operating in the private rented sector in England, the compliance checklist tracks every regulatory obligation from deposit protection to certificate renewals in one place.
The Renters' Rights Act 2025
The Renters' Rights Act 2025, which came into force on 1 May 2026, is the most significant reform to the PRS since the Housing Act 1988. The Act abolishes assured shorthold tenancies and the Section 21 no-fault possession route. From 1 May 2026, every private tenancy in England is now governed by the assured periodic tenancy framework, see assured tenancy for how this replaced the previous assured shorthold tenancy. Possession now requires a landlord to establish one or more of the statutory grounds under Section 8.
The Act also bans rental bidding, prohibits landlords from taking more than one month's rent in advance, strengthens the right to keep a pet, bans discrimination against tenants with children or receiving benefits, and extends Awaab's Law requirements (mandatory response timescales for hazardous conditions) to the private rented sector.
Phase 2 of the Act introduces the PRS Database and PRS Ombudsman, mandatory institutions that will fundamentally change how the sector is regulated and how disputes are resolved. The Database is expected to roll out from late 2026; the Ombudsman is expected to become mandatory from 2028.
PRS in Scotland and Wales
The private rented sector is a UK-wide concept but is regulated differently in each nation. In Scotland, the PRS is governed by the Private Housing (Tenancies) (Scotland) Act 2016, which introduced open-ended private residential tenancies from December 2017, a model England has now followed with the assured periodic tenancy. In Wales, the Renting Homes (Wales) Act 2016 introduced occupation contracts from December 2022, replacing assured shorthold tenancies in Wales with a similar open-ended periodic structure. Northern Ireland operates a separate regulatory framework. Landlords with properties across multiple jurisdictions must understand the legislation in each.
For a practical overview of what the Renters' Rights Act means for landlords operating in the PRS, including the tenancy changes, possession reform, and the Database and Ombudsman rollout, see our guide to what's changing in the PRS from 2026.
Frequently asked questions
How many people rent privately in England?
According to the English Housing Survey 2024–25, the private rented sector comprises approximately 4.7 million households in England, representing around 19% of all households. The government's Guide to the Renters' Rights Act puts the total number of people renting privately at approximately 11 million, letting from around 2.3 million landlords.
What is the difference between the PRS and social housing?
Social housing is owned and managed by a council or registered housing association and let at regulated rents to qualifying households. Private rented sector housing is owned and let by private individuals or companies at market rents. The two sectors operate under different legislation, different regulatory frameworks, and different ombudsman arrangements. A private tenant typically has stronger market-rate negotiating power but historically had less security of tenure than a social tenant; the Renters' Rights Act 2025 has significantly narrowed this gap by ending no-fault evictions in the PRS.
Is Build to Rent part of the PRS?
Yes. Build to Rent properties, purpose-built residential developments held and managed by institutional investors for long-term rental, are part of the private rented sector and subject to the same regulatory framework as individual buy-to-let landlords, including the Renters' Rights Act 2025 assured periodic tenancy requirement. The main practical distinction is operational scale and management model, not legal status.
Does the PRS include holiday lets and Airbnb properties?
Short-term holiday lets and Airbnb-type short-term serviced lets are generally not part of the PRS in the regulatory sense. They are not let as a tenant's only or principal home, so they typically fall outside the assured tenancy framework that defines the PRS. They are subject to separate planning, licensing, and tax regimes. A property that is genuinely a tenant's only or principal home, even if originally marketed as a holiday let, may be treated as a private residential tenancy.
