England’s private rental market has long been defined by a single uncomfortable fact: demand far outstrips supply. Average private-sector rents in England rose 8.6% in the year to July 2024, and in London the figure reached 9.7%. Wikipedia Online property portal Rightmove reported roughly 17 households competing for each advertised rental property. Wikipedia It is against this backdrop that the Labour government passed the Renters’ Rights Act 2025, which received Royal Assent on 27 October 2025, Wikipedia with its first phase of reforms taking effect on 1 May 2026. Blog
To understand what the Act changes, it helps to understand how the existing system worked. Most private tenancies in England are agreed for a fixed term, typically one year, during which a landlord cannot evict a tenant without cause. Once that term expired, however, a landlord could invoke Section 21 of the Housing Act 1988 to issue a notice requiring the tenant to vacate within a set period, with no reason required. Section 21 was not a mechanism for mid-tenancy eviction — it operated at the end of a fixed term. But its existence meant that tenants approaching the end of a contract always faced genuine uncertainty: they might be asked to leave, or they might be offered a renewal, often on different terms. That uncertainty shaped how securely renters could plan their lives.
The Act’s most fundamental change is not simply abolishing Section 21 but eliminating the fixed-term tenancy model altogether. All assured shorthold tenancies are replaced by periodic tenancies that roll on indefinitely. Pinsent Masons Crucially, this applies even where both parties would prefer a fixed arrangement — a landlord and tenant who mutually agree on a two-year term can no longer formalise that in law, with the narrow exception of purpose-built student accommodation. For most renters this provides greater long-term security. But for a tenant genuinely served by a fixed term — someone on a two-year work secondment to the UK, for instance — the new framework offers a protection they neither need nor asked for, while exposing them to the broader market consequences that follow from it.
When a landlord now wishes to recover a property, they must rely on Section 8 of the Housing Act, which requires citing a specific legal ground: substantial rent arrears, anti-social behaviour, a genuine intention to sell the property, or a wish for the landlord or an immediate family member to move in, among others, though each ground carries its own conditions and restrictions. In principle this preserves a workable route to possession. In practice, evicting even a clearly problematic tenant through the courts has long been a slow, expensive, and uncertain process. The Act is intended to clarify and streamline Section 8 procedures, but the underlying problem — an already overburdened court system — is not one that clearer legislation alone can solve. Ministry of Justice data showed landlord possession claims falling 11% year-on-year in the final quarter of 2025, Wikipedia with many landlords reorganising their portfolios before the new rules arrive. If those landlords are replaced by a surge of contested Section 8 cases, waiting times are likely to worsen rather than improve.
The changes to rent increases deserve particular attention. Under the existing system, rent levels are largely shaped by market forces: when a fixed tenancy expires, a landlord seeking higher rent and a tenant who disagrees each decide whether the relationship continues on new terms. The Act removes that dynamic entirely. Landlords will be restricted to one rent increase per year and must give tenants at least two months’ notice. NRLA Tenants who disagree can refer the proposed increase to the First-tier Tribunal for adjudication, at virtually no cost to themselves. With the barrier to challenge so low, it is reasonable to expect that a large proportion of tenants will do exactly that, flooding the Tribunal with cases requiring judges to determine what constitutes a fair market rent. The practical effect is that existing tenants will likely pay the same nominal rent for extended periods — and in an environment of persistent inflation, that is equivalent to a real-terms rent reduction for as long as they choose to stay. That is a genuine benefit for sitting tenants, but it comes at the cost of significant judicial resources and may further erode the incentive for landlords to remain in the sector.
The Act also bans what has long been known in the rental market as “No DSS” — a phrase originating with the old Department of Social Security, which became standard shorthand in property listings for refusing tenants who receive housing benefit. The practice was widespread and openly discriminatory. Landlords and letting agents will no longer be permitted to refuse applicants on the basis that they have children or receive benefits, NRLA and must assess each applicant on their individual circumstances. The amount of rent that can be collected in advance is also capped at one month, NRLA reducing the financial barriers that have historically disadvantaged migrants, lower-income renters, and those without a UK-based guarantor.
Later phases extend the Act’s scope further. Phase Two will establish a national landlord database and a Private Rented Sector Ombudsman, giving tenants a means of resolving complaints without going to court. Phase Three will introduce a Decent Homes Standard for privately rented properties and require all rental homes to achieve an EPC C energy efficiency rating by 2030. NRLA Each of these measures carries its own compliance costs for landlords.
The Act offers greater protections to existing tenants, but its fundamental limitation is that it adjusts the balance of power between landlords and sitting tenants rather than expanding the total number of homes available to rent. England’s rental crisis is rooted in structural undersupply — the consequence of decades of insufficient housebuilding, a restrictive planning system, and high land costs. If landlords respond to rising obligations and reduced flexibility by selling up or converting properties to short-term lets, the stock of long-term rental homes will shrink further. The groups most exposed to that contraction — new arrivals to the country, workers on temporary assignments, families on benefits — are largely the same groups the Act is designed to protect. Strengthening the rights of tenants who already have a home and making it easier for the next person to find one are not always the same objective, and this Act largely addresses only the first.
