The Renters’ Rights Act 2025
The unintended consequences of rent regulation
The Renters’ Rights Act came into force in May and aims to strengthen protection for tenants. Mariana Burns of Fieldfisher considers the impact of the Act on tenants and the rental market.
The Renters' Rights Act 2025 came into force on 1 May 2026. Its central aim is to strengthen tenant security, restrict unfair eviction and provide greater protection against unjustified rent increases and other unfair rental practices.
With effect from 1 May 2026, the assured shorthold tenancy regime was abolished. All new and existing assured tenancies are now periodic tenancies, with no fixed end date and operating on a monthly rolling basis, or such shorter period as may apply.
The application of the Act is, confined to arrangements that satisfy the statutory conditions for an assured tenancy. Accordingly, certain categories of tenancy remain excluded by virtue of schedule 1 to the Housing Act 1988. The principal exclusions of practical relevance are as follows:
- high-rent tenancies, where the annual rent exceeds £100,000;
- long leases and certain fixed-term arrangements; and
- tenancies falling outside the residential assured tenancy definition, including corporate lettings, holiday lettings and specified student accommodation.
Practical impact:
Classification is critical. Whether a tenancy falls within the assured tenancy regime will determine whether the Act’s rent controls and security of tenure protections apply.
Regulation under the Act
Landlords wishing to increase rent must follow the Act’s prescribed procedure and be able to justify the increase with market evidence.
Rent increases must follow the correct legal process. A landlord must serve a section 13 notice (Form 4A) giving the tenant at least two months' notice of a proposed rent increase.
Landlords will need to use this statutory route when increasing rent during an ongoing periodic tenancy under the new framework.
The notice must be completed correctly and properly served. If it is not, the proposed increase may not take effect. The proposed amount must also be justifiable as a rent reflecting local market conditions at the time of the review.
Existing contractual rent review clauses are unenforceable. Landlords cannot now rely on these clauses to increase rent outside of the statutory section 13 process.
Rent can only be increased once every 12 months. No increase is allowed within the first year of the tenancy or within 12 months of the last increase. The landlord must give at least two months’ notice.
The proposed rent must reflect the open market value, based on comparable local properties, property condition, size, location, and amenities.
Evidence should be retained to show how the opinion as to market rent came about, and this should be defensible given tenants challenge rights.
Tenants may apply to the First-tier Tribunal if they consider the proposed rent exceeds open market value; the Tribunal may reduce the rent to open market level but cannot increase it above the landlord’s proposal.
Potential impact:
Low-cost Tribunal challenges may become a simple route for tenants to delay rent increases, with no risk of a higher rent award.
An application fee of £47 is payable to challenge a rent increase, with no separate hearing fee.
Unsuccessful challenges cannot be backdated, and so tenants may use the process as a tool to defer higher rents, even where the landlord ultimately succeeds. The likely result is more disputes, slower Tribunal outcomes and greater burden for landlords and agents.
Bidding wars
The Act prevents bidding wars, which were common in high-demand areas, where prospective tenants competed by offering more to secure a home. Landlords and agents are now required to publish an asking rent for the property, and it will be illegal to accept (or even encourage) offers above this rate.
Potential impact:
The ban may curb inflated bidding, but without a cap on initial asking rents, landlords may price higher from the outset to secure the best rent possible.
Rent in advance
The Act prohibits landlords from demanding or accepting large amounts of rent in advance of the commencement of the tenancy. Landlords cannot ask for, encourage or accept rent before the tenancy agreement has been signed by both sides. Once signed, if rent is monthly, the landlord can ask for the first month’s rent between signing and the start date; if rent is payable more frequently, the landlord can ask for up to the first 28 days’ rent. Once the tenancy has started, rent falls due on the contractual due date and the landlord cannot require earlier payment, although the tenant may choose to pay early.
Potential impact:
Limiting rent in advance should reduce upfront cost for tenants but also removes an important risk-mitigation tool for landlords (which was a key reason some tenants could secure a tenancy).
Landlords may respond with more rigorous affordability checks, stronger guarantor requirements and more risk-averse tenant selection.
Market impact
Private residential landlords are already operating against a challenging backdrop, including increased regulatory pressure, higher mortgage interest rates, the removal of full mortgage interest tax relief and increased stamp duty costs.
Overall impact:
For landlords, the Act means reduced flexibility, heavier compliance and greater reliance on the courts. The risk is a more cautious and constrained rental market, with increased uncertainty for both landlords and tenants as the reforms take effect.
Key reforms in the Renters’ Rights Act
The Act abolishes no-fault evictions
It replaces assured shorthold tenancies with rolling periodic tenancies
It introduces controls on rent increases, large advance rental payments and introduces other tenant protections
Further reforms expected in late 2026 include the introduction of a landlord ombudsman scheme and a private rented sector database requiring landlord and tenant registration.