The Scottish MP at the centre of a row over renting homes to fellow politicians has indicated he plans to move out when his lease is up.
Aides to Iain McKenzie, the Labour MP for Inverclyde, said he would be looking for alternative accommodation.
It comes as the parliamentary watchdog announced plans to reconsider rules that allow MPs to let homes to each other, with the rent paid by the taxpayer.
The move by the Independent Parliamentary Standards Authority (Ipsa) followed its announcement that, in accordance with its rules, 27 MPs including former defence secretary Liam Fox and Labour Shadow Defence Secretary Jim Murphy are claiming rent in London while leasing out properties in the capital.
The watchdog has also confirmed four MPs are currently renting their London homes to other politicians.
Mr McKenzie is currently renting a flat owned by Linda Riordan, the Labour MP for Halifax. Reports suggested she was making a profit because her mortgage payments are less than she receives in rent.
Mr McKenzie insists he did not know who owned the flat when he moved in last year, and only discovered the owner was an MP some time later.
He said: "If I had known beforehand that the flat was owned by an MP then I probably wouldn't have taken it. You've got to apply the test of how it looks to the man in the street, regardless of whether it's above-board or not."
MPs insist they have no choice but to rent out their homes.
Under new rules introduced in the wake of the 2009 expenses scandal, they can no longer claim for mortgage interest in London and can only recoup rent instead.
Many MPs say the situation means they can no longer afford to live in the flats they have bought in London.
They also argue it would be difficult to sell their property because of the recession, and many MPs are also paying off mortgages on the homes they are required to have in their constituencies.
Others named as renting as well as owning a home in London include Glasgow Labour MP Ian Davidson, SNP MP for Moray Angus Robertson and Charles Kennedy, the former Liberal Democrat leader.
None of the MPs is breaking any rules. However, the revelations will fuel concerns politicians are still able to profit from parliamentary expenses.
The Speaker John Bercow has warned the details of MPs' landlords should not be released, citing security concerns.
Matthew Sinclair, chief executive of the TaxPayers' Alliance, said: "If MPs are again found to have exploited the expenses system, it will be another stain on the reputation of Parliament."
A spokesman for David Cameron said he considered the issue a matter for Ipsa.
Ipsa said: "The next public consultation on the rules will launch in November. As part of this we will consider the issue of MPs renting from other MPs."
Sir Christopher Kelly, chairman of the Committee on Standards in Public Life, said: "The principles here are clear – MPs should be properly reimbursed for costs they incur but not obtain personal financial advantage from the system."
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