Although the private rented sector (PRS) in Northern Ireland is relatively small when compared with the other tenures, it performs a number of important functions in addressing housing needs. The PRS is not homogeneous and is made up of a number of sub-markets. Rugg, Rhodes and Jones (2002) have summarised a number of demand groups for private renting, including "life-stage" users, young people renting a property before entering owner occupation, short-term emergency users, such as households experiencing relationship breakdown, older renters that have been living in privately rented housing for some time and "residual users", namely housheolds in low incomes. This paper examines data from the Northern Ireland House Condition Survey, the Continuous Household Survey and interviews with tenants and estate/letting agents. The paper presents evidence indicating that those living in the PRS are increasinly "residual users", i.e. those that have traditionally been housed in the social sector and outlines the reasons for the phenomenon. The paper is based on research commissioned by the Northern Ireland Housing Executive that was carried out in twp phases.