The Renters' Rights Act 2025: what UK letting agents must do

The Renters' Rights Act 2025 is the biggest overhaul of the private rented sector in a generation. It became law on 27 October 2025, and the core tenancy reforms took effect on 1 May 2026: assured shorthold tenancies converted to open-ended periodic tenancies, Section 21 "no-fault" evictions were abolished, and a single reformed set of possession grounds now applies to every tenancy — new and existing. For letting agents the practical change is sweeping: how a tenancy begins, how it ends, how rent rises, and what your records have to prove all move at once.

What is the Renters' Rights Act 2025, and when does it apply?

The Act delivers the reform first proposed as the Renters' Reform Bill, and it is being switched on in phases rather than all at once.

• Royal Assent: 27 October 2025. The Bill became the Renters' Rights Act 2025.
• Council enforcement powers: from late December 2025. Local authorities gained stronger investigatory powers — to inspect, demand documents and share data — to police the new rules.
• The new tenancy system: from 1 May 2026. This is the change most agents feel. It applies to both new and existing tenancies at the same time, so there was no grace period for legacy agreements.
• Further reforms are phased. The extension of the Decent Homes Standard and Awaab's Law to the private rented sector, the new Private Rented Sector Database, and the mandatory PRS Landlord Ombudsman are being commenced separately through secondary legislation. Track the government's implementation roadmap for each start date rather than assuming a single switch-on — the dates are set by regulation, not guesswork.

What changed for tenancies and Section 21?

Assured shorthold tenancies (ASTs) and fixed terms are gone. Every private rented tenancy is now a single type: an assured periodic tenancy that rolls from period to period with no end date.

• No fixed term. A tenancy no longer runs for six or twelve months and then "ends"; it continues until it is properly brought to an end.
• Section 21 is abolished. A landlord can no longer end a tenancy simply by serving notice with no reason. Possession now requires a valid legal ground.
• Tenants can leave on two months' notice. A tenant can end the tenancy at any time by giving two months' notice, which changes how you forecast voids and re-lets.

For an agency, that means your tenancy agreement templates, your renewals process and your void planning all needed rewriting around a periodic-by-default world.

How does possession work now?

With Section 21 removed, every possession runs through the reformed Section 8 grounds. Some grounds are new, several are amended, and the notice periods and evidence requirements differ by ground.

The everyday consequence is that the ground and the evidence behind it now decide whether a claim succeeds. If a landlord wants to sell or move in, there is a defined ground with its own notice period — and, having used it, the property generally cannot be re-marketed or re-let for a set period (twelve months). Rent-arrears and anti-social-behaviour grounds have been reworked too. A vague file that was fine under Section 21 will fail under Section 8, so the tenancy record — dates, notices, correspondence, arrears history — becomes the case.

What about rent increases and rent in advance?

The Act standardises how rent goes up and closes off several practices.

• One increase a year, by the statutory route. Rent can be raised once every twelve months using the Section 13 process, and the tenant can challenge an above-market increase at the First-tier Tribunal.
• No rental bidding. You must advertise a rent and cannot invite or accept offers above it — the "bidding war" is unlawful.
• Rent in advance is limited. The amount of rent you can require up front is capped, so large advance-payment arrangements no longer work as a screening tool.

All of this rewards a clean rent ledger and a defensible audit trail. If reconciliation and statements are already tight, an annual, tribunal-proof increase process is straightforward; if they are not, it is a monthly scramble. This is exactly the discipline behind how to reconcile client money, and it is the day-to-day of a well-run client money function.

What must agents stop doing?

Several long-standing practices are now unlawful and should already be out of your adverts, referencing and tenancy handling:

• No blanket "no DSS" or "no benefits". Discriminating against tenants because they receive benefits is prohibited.
• No "no children" bans. Rejecting a family purely because they have children is prohibited.
• No unreasonable refusal of pets. A tenant can request to keep a pet and you cannot unreasonably refuse; a landlord may require pet damage cover or insurance as a condition.
• No bidding wars (see above).

What new compliance obligations are coming?

The reforms that raise the property-standards and accountability bar are being phased in, and each adds to what your back office must evidence:

• Decent Homes Standard for the PRS — a minimum condition standard that rented homes must meet.
• Awaab's Law in the PRS — legal timescales to investigate and fix serious hazards such as damp and mould.
• The PRS Database — landlords (and, in practice, their agents) will need to register properties and key information.
• The PRS Landlord Ombudsman — mandatory membership of a redress scheme for private landlords.

Together these turn property condition, repair response times and record-keeping into auditable obligations. A structured compliance function, a real repairs and maintenance workflow and a proper periodic inspection programme stop being "nice to have" and become the evidence you rely on. Our lettings compliance calendar is a useful starting point for tracking dated obligations per property.

How should a letting agency prepare its back office?

The Act is, underneath, a records-and-process change. Preparing well looks like this:

1. Reissue your tenancy documents. Move every template to the periodic assured tenancy and remove fixed-term and Section 21 language.
2. Retrain on Section 8. Make sure the team knows which ground fits which situation, the correct notice period, and the evidence each requires — and build a tenancy-by-tenancy evidence trail as you go, not after a dispute starts.
3. Tighten rent handling. Run a clean ledger and a documented, once-a-year Section 13 increase process that would stand up at tribunal.
4. Systematise condition and compliance. Track certificates, inspections and repair response times against real deadlines so Decent Homes and Awaab's Law obligations are provable, not hopeful.
5. Register when the schemes go live. Plan for the PRS Database and Ombudsman as each is commenced.

Most of this is volume work that a spreadsheet cannot carry safely across a growing portfolio. It is the same underlying problem described in the true cost of a disconnected back office: when data is re-keyed and dates live in people's heads, one missed notice period or lapsed certificate becomes a failed possession claim or an enforcement action.

Frequently asked questions

Is Section 21 really abolished?

Yes. From 1 May 2026, Section 21 "no-fault" evictions ended for both new and existing tenancies. A landlord now needs a valid Section 8 ground — with the right notice and evidence — to take possession.

Did existing tenancies convert automatically?

Yes. On 1 May 2026, existing assured shorthold tenancies became periodic assured tenancies. There was no separate re-signing step, which is why updating templates and processes ahead of the date mattered.

Can landlords still increase the rent?

Yes — once every twelve months, through the statutory Section 13 process. The tenant can refer an above-market increase to the First-tier Tribunal, so the increase needs to be reasonable and properly served.

The Renters' Rights Act rewards agencies that treat operations as the core of the business. If you would rather not absorb all of this into your existing team, Solace runs the lettings back office — client money, compliance, repairs and inspections — as smart software plus a real UK team, under your own brand. To see how it would handle the new regime across your portfolio, book a demo.