Landlords

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

By Dessy · 9 August 2026 · 8 min read

The Renters' Rights Act has changed the rules of private renting in England. Here's what London landlords need to know — and why some property owners are looking at alternatives to the traditional tenancy model.

If you own a rental property in London, 2026 marks a significant change in the way you let and manage it.

The Renters' Rights Act 2025 came into force in stages, with the first major changes taking effect on 1 May 2026. For landlords in the private rented sector, the reforms include the end of Section 21 "no-fault" evictions, the move to assured periodic tenancies and changes to rent increases, possession and tenant protections.

The changes are designed to give renters greater security and stronger protections. For landlords, however, they also mean that the traditional long-term rental model requires a different approach to risk, compliance and property management.

That does not mean traditional letting is no longer viable. But it does mean that landlords have more reason than ever to understand their options.

What changed on 1 May 2026?

The first phase of the Renters' Rights Act introduced several important changes to private renting in England.

Section 21 "no-fault" evictions ended

From 1 May 2026, private landlords can no longer use Section 21 to recover possession of an assured tenancy without relying on a specific legal ground.

If a landlord wants to regain possession, they generally need to rely on one of the statutory possession grounds and follow the correct notice and court process where required.

This is one of the most significant changes introduced by the Act. It means that a landlord can no longer simply wait for a fixed-term tenancy to end and then use Section 21 as a straightforward route to possession.

Fixed-term assured tenancies have effectively been replaced

Most existing assured shorthold tenancies became assured periodic tenancies on 1 May 2026, while new assured tenancies are now periodic rather than fixed-term.

There is no contractual end date in an assured periodic tenancy. Instead, the tenancy continues until the tenant leaves or the landlord regains possession using the appropriate legal process.

For landlords accustomed to having a defined end date on a six- or twelve-month tenancy, this is a fundamental change.

Rent increases are more restricted

Under the new rules, landlords can generally increase rent only once a year and must follow the prescribed process and notice requirements. Tenants can challenge a proposed increase if they believe it is above market rent.

The Act also introduced restrictions on rental bidding, meaning landlords cannot encourage or accept offers above the advertised rent.

Tenants have new rights around pets

Tenants have a right to request permission to keep a pet, and landlords must consider the request within the prescribed process and provide a valid reason if they refuse it.

There are also new protections around discrimination against prospective tenants because they have children or receive benefits.

What does this mean for London landlords?

The important point is not simply that "landlords have fewer rights." The reality is more nuanced.

Landlords still have legal grounds to recover possession, including circumstances such as serious rent arrears, antisocial behaviour, selling the property or needing to move into it themselves, subject to the specific statutory requirements.

But the structure of the relationship has changed. A traditional residential tenancy now places greater emphasis on:

For a landlord who is happy with the traditional model, these may simply be part of running a rental property. For others, it may be a good moment to ask whether the traditional tenancy is still the best fit for their property and objectives.

Is traditional letting still the right option?

For many landlords, the answer will be yes. A long-term tenancy can provide predictable rental income with relatively low operational involvement, particularly when a good tenant stays for several years.

But it is not the only model available. Depending on the property, location, building rules, mortgage, insurance and local regulations, landlords may also consider:

The important thing is that not every property is suitable for every model. Location, demand, layout, furnishing, local restrictions and the property's legal and contractual position all need to be considered.

What about a company lease?

This is where the conversation becomes more interesting.

Some landlords choose to work with a professional accommodation company rather than letting their property directly to an individual residential tenant. Instead of entering into a conventional landlord-and-tenant arrangement with the person staying in the property, the owner may enter into a contractual arrangement with a company that operates the property as accommodation.

However, it is important not to assume that simply calling an agreement a "company lease" automatically changes its legal status.

The substance of the arrangement matters. Whether the Renters' Rights Act applies depends on the nature of the agreement, the property and how it is occupied. Commercial lettings are outside the assured-tenancy guidance, but landlords should obtain appropriate legal advice on the specific structure before relying on a company arrangement as an alternative to residential letting.

For landlords considering this route, the right question is therefore not:

"Can I call this a company lease?"

It is:

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

That distinction matters.

Why are some London landlords considering serviced accommodation?

The Renters' Rights Act is not, by itself, a reason every landlord should move into serviced accommodation.

Serviced accommodation brings its own responsibilities and risks. Occupancy can fluctuate, operating costs are higher and the property needs to be professionally managed. But for the right property in the right location, it can offer a different balance between income, flexibility and control.

A professionally operated short and medium-term property can attract guests such as:

These guests are often looking for something different from a conventional hotel room: more space, a kitchen, privacy, workspace and the ability to live normally during their stay.

For landlords, the attraction can be the opportunity to work with an operator who takes responsibility for the day-to-day accommodation business rather than managing individual guest bookings themselves.

What should a landlord consider before switching?

Serviced accommodation is not simply "renting your property out on Airbnb." There is a considerable amount of operational and regulatory work behind a professionally run property.

Before making a decision, a landlord should consider:

1. Is the location suitable?

Demand varies significantly across London.

Properties close to major transport links, business districts, Heathrow and other employment or visitor hubs can have strong demand, but the specific neighbourhood still matters.

2. Does the property work for longer stays?

A property that looks attractive for a two-night booking may not work as well for a guest staying for two months.

Good kitchens, comfortable living space, workspace, storage and access to everyday amenities become much more important.

3. Are there restrictions?

Leasehold terms, freeholder requirements, mortgage conditions, insurance policies, planning considerations and local authority rules should all be checked before operating short or medium-term accommodation.

4. Who will manage the property?

Serviced accommodation is operational.

Guest communication, cleaning, inspections, maintenance, pricing, availability, compliance and problem-solving all need to be handled properly.

For many landlords, the attraction is therefore not simply the accommodation model itself, but having a professional operator manage it on their behalf.

5. Does the financial model actually work?

A higher potential gross income does not automatically mean higher profit.

Cleaning, utilities, furnishing, maintenance, management, platform fees, VAT where applicable and periods of lower occupancy all need to be included in the calculation.

A good operator should be able to show a landlord a realistic income projection rather than simply quoting the highest possible nightly rate.

The bigger question for landlords in 2026

The Renters' Rights Act has not made traditional letting impossible. It has, however, changed the balance of the traditional landlord-tenant relationship.

For some landlords, the right response will be to continue with a long-term rental and adapt their management processes. For others, this may be the moment to explore whether short-term or medium-term accommodation could offer a better fit for their property and their goals.

There is no universal answer. The right model depends on the property, the location, the numbers and the landlord's appetite for involvement.

At Elite Stays, that is why we don't take every property. We select properties that meet our standards for location, quality, guest appeal and operational potential, then assess whether they are genuinely suitable for professionally managed short and medium-term accommodation. If the numbers or the property don't work, we'd rather say so.

A different way to let your London property

Elite Stays operates 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:

The first step is not signing a contract. It's understanding whether the property is actually suitable.

Could your property work as serviced accommodation?

Request a free rental appraisal →

We'll assess the property, its location and its potential and give you a realistic view of whether working with Elite Stays makes 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 depends on the specific facts and contractual structure. Landlords should obtain independent legal and professional advice before changing their letting model.