Landlords

The Renters' Rights Act Explained: What It Means for London Landlords in 2026

By Dessy · 9 August 2026 · 9 min read

The Renters' Rights Act changed private renting in England on 1 May 2026. Here's what London landlords need to know — and why some property owners are considering alternatives to the traditional tenancy model.

If you own a rental property in London, 2026 marks one of the biggest changes to the private rented sector in a generation.

The Renters' Rights Act 2025 came into force in its first major phase on 1 May 2026. Section 21 "no-fault" evictions have ended, most existing assured shorthold tenancies have become assured periodic tenancies, and landlords now need to rely on specific legal grounds when they want to recover possession.

There are also new rules around rent increases, rent in advance, rental bidding, pets and discrimination.

The reforms are designed to give renters greater security and protection. For landlords, the message is not that renting is no longer viable — it is that good management, accurate records and understanding the rules matter more than ever.

For some landlords, that may simply mean adapting how they manage their existing rental. For others, it may be a good time to consider whether a traditional residential tenancy is still the best model for their property.

What changed on 1 May 2026?

The first phase of the Renters' Rights Act introduced several major changes affecting landlords and tenants across England.

Section 21 "no-fault" evictions have ended

From 1 May 2026, landlords can no longer serve a new Section 21 notice to end an assured tenancy without relying on a specific legal ground.

Instead, landlords generally need to use the revised Section 8 possession grounds, where applicable, and follow the correct notice and court process.

This does not mean landlords can never regain possession. There are still grounds covering situations such as:

The important change is that possession now needs to be based on an applicable legal ground rather than simply the landlord deciding not to continue the tenancy.

Fixed-term tenancies are gone

Existing assured shorthold tenancies automatically became assured periodic tenancies on 1 May 2026. New assured tenancies are also generally periodic rather than fixed-term.

In practical terms, the traditional six- or twelve-month fixed term no longer provides the same contractual end point. The tenancy continues until the tenant leaves or the landlord uses the appropriate legal process to recover possession. Tenants can generally end an assured periodic tenancy by giving two months' notice.

For landlords, this means that void planning needs to be based more on actual tenant behaviour and notice patterns rather than simply assuming a property will become available when a fixed term expires. Good marketing, pricing and speed of re-letting therefore become increasingly important.

When can a landlord still recover possession?

This is one of the most important parts of the new system.

The Renters' Rights Act has not removed a landlord's ability to recover their property. It has changed the circumstances and process through which this happens. For example, a landlord may be able to recover possession where they genuinely intend to:

Sell the property

There is a specific possession ground for landlords who want to sell.

For this ground, the notice period is generally four months. There are also restrictions on using the ground during the early part of a tenancy and on re-letting the property after possession has been obtained using it.

Move into the property

There is also a possession ground where the landlord or certain close family members genuinely need to move into the property.

Again, this comes with specific conditions and notice requirements.

Recover possession because of rent arrears

This is an area where the changes are particularly relevant to landlords.

For the mandatory rent-arrears ground, the tenant generally needs to have at least three months' rent arrears at both the point the notice is served and the possession hearing. The notice period for this ground is four weeks.

There are also discretionary grounds covering other arrears situations and persistent late payment.

The practical lesson is straightforward: do not wait until arrears become a major problem before acting. Early communication, accurate rent statements and good records can make a significant difference.

Antisocial behaviour

There are also grounds allowing landlords to act where tenants or people associated with the tenancy engage in antisocial behaviour. The notice period depends on the specific ground being used.

Evidence matters more than ever

This is one of the biggest practical implications of the new system.

If possession depends on proving a particular ground, your documentation matters. A well-managed property should have a clear compliance and evidence file containing, where applicable:

The government has also introduced requirements around providing tenants with written information about the key terms of their tenancy.

The principle is simple: if you ever need to rely on a legal process, being able to demonstrate that you have managed the tenancy correctly is critical.

Rent increases are now more structured

Landlords can generally increase rent only once a year for an assured periodic tenancy and must follow the prescribed process.

The landlord must use a Section 13 notice and give the required notice period. A tenant can challenge a proposed increase at the First-tier Tribunal if they believe it is above market rent.

This makes regular, evidence-based rent reviews increasingly important. Rather than allowing rent to fall behind the market for several years and then attempting a large increase, landlords may want to monitor comparable rents and review their pricing annually.

Rental bidding has been banned

Another important change is that landlords and letting agents can no longer encourage or accept offers above the advertised rent.

The property must be advertised at a specific asking rent and landlords cannot accept a higher offer. For landlords, this makes accurate initial pricing more important — you cannot simply advertise a property below market value and rely on prospective tenants bidding against one another to establish the final rent.

You can no longer ask for several months' rent upfront

The Act also changes how landlords can structure rent payments at the start of a tenancy.

In general, landlords cannot require more than one month's rent in advance and cannot require rent to be paid before the tenancy has been entered into in circumstances prohibited by the legislation.

For landlords who previously used several months' rent upfront as an additional way of managing risk, this removes one tool from the landlord's toolkit. That makes proper referencing, affordability assessment and guarantor arrangements where appropriate more important.

Pets: landlords have to consider requests

Tenants now have stronger rights to request permission to keep a pet.

A landlord cannot simply operate a blanket policy refusing every pet request. Requests must be considered properly and cannot be unreasonably refused. Importantly, landlords cannot require tenants to take out pet insurance as a condition of consent.

For landlords, a good written pet policy and a thorough inventory become even more important.

No blanket bans on benefits or families with children

The Act also makes it unlawful for landlords and agents to discriminate against prospective tenants because they receive benefits or have children.

This does not mean landlords have to accept every applicant. Normal affordability and referencing checks remain important. But decisions need to be based on legitimate criteria rather than blanket policies such as "No DSS" or "No children".

For landlords and agents, this means reviewing how properties are advertised and how applicant screening is carried out.

What is still coming?

The changes introduced on 1 May 2026 are only the first phase of the wider reforms.

Private Rented Sector Database

From late 2026, the government plans to introduce a national Private Rented Sector Database containing information about landlords and rented properties. The database is intended to help landlords demonstrate compliance and help tenants and councils access information about rented properties.

Private Rented Sector Landlord Ombudsman

A new Landlord Ombudsman is also planned, providing a formal route for resolving disputes between landlords and tenants without every disagreement having to progress through the courts. The implementation timetable is still being phased in, so landlords should keep an eye on the latest government guidance.

Decent Homes Standard and Awaab's Law

Further reforms are planned around housing quality, including extending the Decent Homes Standard and Awaab's Law to the private rented sector. The detailed implementation timetable is still to be confirmed. The direction of travel is clear: higher standards, greater transparency and stronger tenant protections.

What does this mean for London landlords?

The Renters' Rights Act does not mean that traditional residential letting is no longer viable. For many landlords, it will remain a perfectly good investment strategy. But the economics and responsibilities of being a landlord have changed.

A landlord now needs to think carefully about:

For some landlords, the answer will be an uncomplicated "yes". For others, the changes may be the catalyst for exploring alternatives.

Is a company lease an alternative?

This is where things become more nuanced.

Some property owners choose to work with a professional accommodation company rather than letting their property directly to an individual residential tenant. The owner and the company enter into a commercial arrangement, and the company then operates the property as accommodation. This can potentially give the owner a different relationship from a conventional residential letting.

However, a contract being called a "company lease" does not automatically mean that the Renters' Rights Act or other housing legislation does not apply. The legal status depends on the actual structure of the arrangement, the parties involved, the terms of the contract and how the property is occupied.

Commercial arrangements can fall outside the assured-tenancy regime, but landlords should take independent legal advice on the specific structure before assuming that a company lease provides a particular legal outcome.

The right question is therefore not:

"Can I call this a company lease?"

It is:

"What is the actual legal and commercial structure, and is it appropriate for my property and objectives?"

That distinction matters.

Why are some landlords considering serviced accommodation?

The Renters' Rights Act is not, by itself, a reason for every landlord to switch to serviced accommodation.

Serviced accommodation has its own responsibilities. Occupancy can fluctuate. Operating costs are higher. Utilities, cleaning, furnishing, maintenance, insurance, compliance and guest management all need to be considered.

But for the right property in the right location, professionally managed short and medium-term accommodation can offer a different balance of income, flexibility and operational control. Potential guests include:

These guests often want something different from a traditional hotel: more space, a kitchen, privacy, workspace and the ability to maintain their normal routine.

For a landlord, the attraction can be working with a professional operator that takes responsibility for the accommodation business rather than the owner managing individual bookings themselves.

Is serviced accommodation right for every London property?

Absolutely not. And this is an important point.

A property should not be put into short or medium-term accommodation simply because somebody promises a higher gross income. The property needs to work for the guests, the location needs to have genuine demand, and the numbers need to make sense after all operating costs.

Before changing your letting strategy, consider:

Location

Does the area attract the type of guests who use serviced accommodation?

Properties near Heathrow, major transport links, business districts and employment hubs can have strong demand, but the specific location still matters.

Property layout

Does the property offer enough space for someone staying for several weeks?

A good kitchen, comfortable living area, workspace and storage can become much more important for a longer stay.

Restrictions

Are there restrictions in the lease, mortgage, insurance policy, planning position or building rules that affect how the property can be used? These need to be checked before proceeding.

Operating costs

Serviced accommodation has different costs from a conventional long let. Cleaning, utilities, linen, maintenance, furnishing, management, platform fees and other operating expenses all need to be included in the calculation.

Management

Short and medium-term accommodation is operational. Someone needs to manage bookings, pricing, guest communication, cleaning, inspections, maintenance and compliance.

For many owners, the attraction is therefore not simply the model itself, but having a professional operator manage it properly.

The opportunity hidden inside the changes

It is easy to look at the Renters' Rights Act purely as a list of restrictions. But there is another way to look at it.

The reforms are pushing the private rented sector towards better standards, better records, better management and more professional landlords. For landlords who already operate professionally, that can be an advantage.

The question is therefore not necessarily:

"Is the Renters' Rights Act bad for landlords?"

A better question might be:

"Which property strategy gives me the right balance of income, control, risk and involvement?"

For some landlords, that will remain a traditional long-term tenancy. For others, it may be a different form of rental arrangement. And for some properties, professionally managed short or medium-term accommodation may be worth exploring.

A different way to let your London property

At Elite Stays, we select properties that meet our standards for location, quality, guest appeal and operational potential.

We operate professionally managed serviced apartments in London and near Heathrow, providing accommodation for short, medium and extended stays. For property owners, we offer two models depending on the property and the owner's objectives.

Guaranteed Rent

A company lease with agreed rental income and professional management.

Fully Managed Short & Medium-Term Lets

We operate the property as serviced accommodation, managing pricing, bookings, guests, cleaning, inspections and day-to-day operations.

We do not believe every property is suitable for serviced accommodation. That is why the first step is not signing a contract. It is assessing the property honestly. If the numbers, location or property do not work, we'd rather say so.

Could your London property work as serviced accommodation?

Request a free rental appraisal and we'll assess the property, its location and its potential, giving you a realistic view of whether working with Elite Stays could make sense.

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This article is intended as general information, not legal advice. The application of the Renters' Rights Act and the legal status of any company lease or accommodation arrangement depend on the specific facts and contractual structure. Landlords should obtain independent legal and professional advice before changing their letting model.