Renters’ Rights Act 2026: What Buy-to-Let Investors Need to Know

What Is a Turnkey Property? A Complete Guide for UK Investors

The Renters’ Rights Act 2025 received Royal Assent in October 2025 and its first phase takes effect on 1 May 2026. It represents the most significant overhaul of England’s private rented sector since the Housing Act 1988 – and every buy-to-let investor needs to understand what’s changing.

Key Takeaways

• Section 21 Abolished: No-fault evictions end on 1 May 2026. Landlords must now use specific grounds under Section 8 to regain possession.
   
• All Tenancies Become Periodic: Fixed-term ASTs convert automatically. Tenants can leave with two months’ notice at any time.
   
• Rent Increases Capped: Landlords may only increase rent once per year, in line with market rates. Rental bidding is banned.
   
• Short-Let Strategies Gain Appeal: Short-lets and serviced accommodation operate outside the AST framework, offering investors greater flexibility under the new rules.
   
• New-Build Advantage: Modern and well-maintained apartments are better positioned under the Act’s incoming Decent Homes Standard and Awaab’s Law requirements.

1. What Is the Renters’ Rights Act?

The Renters’ Rights Act is a comprehensive reform of England’s private rented sector. It replaces the current system of Assured Shorthold Tenancies (ASTs) with a new framework designed to give tenants greater security while maintaining landlords’ ability to manage their properties.

The Act rolls out in three phases. Phase 1 begins on 1 May 2026 and includes the headline changes. Phase 2, covering the new PRS Database and Ombudsman, follows in late 2026. Phase 3, including the Decent Homes Standard extension, comes later.

2. Key Changes Taking Effect on 1 May 2026 (Phase 1)

2.1 Section 21 No-Fault Evictions Abolished:

From 1 May, landlords can no longer serve a Section 21 notice to end a tenancy without reason. Instead, they must rely on specific grounds under Section 8 – such as intending to sell the property (Ground 1A) or moving in themselves (Ground 1). Both grounds require the tenancy to have been in place for at least 12 months and carry a four-month notice period.

3. What Does This Mean for Buy-to-Let Investors?

The immediate reaction from some landlords has been concerning – but the practical impact is more measured than the headlines suggest.

3.1 Tenant Quality Matters More than Ever:

Without Section 21 as a safety net, thorough referencing and vetting is essential. Working with a professional letting agent or management company ensures tenants are properly vetted from the start.

3.2 Good Properties Retain Good Tenants:

The Act incentivises landlords to maintain high-quality accommodation. Properties that are well-finished, modern and energy-efficient are far less likely to face complaints, tribunal challenges or tenant disputes. This is where new-build apartments have a clear advantage.

3.3 Stability can Work in Your Favour:

Periodic tenancies may sound unsettling, but in practice, quality tenants in desirable locations stay for years. According to researches, the average tenancy length in England is now over four years. Longer tenancies mean fewer void periods, lower turnover costs and more predictable income.

    Q: Should I sell my buy-to-let property before the Act takes effect?
    A: Not necessarily. While some landlords are exiting the market, this is creating opportunities for those who stay. Reduced supply pushes rents higher, and demand for quality rental homes remains strong – particularly in cities like Manchester and Birmingham where population growth continues to outpace housing supply.

4. Could Short-Let Strategies Offer an Alternative?

It’s worth noting that the Renters’ Rights Act primarily applies to assured shorthold tenancies – the standard long-term rental agreements. Short-let and serviced accommodation strategies operate under a different legal framework, and many of the Act’s restrictions don’t apply.

Where short-lets have an advantage under the new rules:

• No Section 21/Section 8 restrictions – Short-let agreements aren’t ASTs, so the new eviction rules don’t apply. You retain full flexibility over occupancy.
   
• No rent increase limitations – You can adjust pricing based on demand, unlike long-term lets which are now limited to one annual increase at market rates.
   
• No advance rent restrictions – Short-lets typically collect full payment at booking, which remains unaffected by the Act.
   
• No periodic tenancy conversion – Your properties don’t get locked into rolling tenancies.

That said, short-lets come with their own considerations – higher management overhead, seasonal demand fluctuations and local licensing requirements in some areas. They’re not a replacement for traditional letting, but rather a complementary strategy that some investors are now incorporating alongside their long-term portfolio.

5. Why New-Build Apartments Are Well Positioned?

The Act introduces Awaab’s Law for the private sector (requiring landlords to address hazards like damp and mould within strict timeframes) and will eventually extend the Decent Homes Standard to all private rentals.

For landlords with older properties, this could mean significant retrofit costs. For those investing in new-build apartments, compliance is largely built in from day one – modern insulation, ventilation systems, high EPC ratings and developer warranties all reduce the compliance burden.

Opportunity for Landlords: Phoenix, Leeds

A city centre new-build development with modern amenities, short-let approved status, and strong rental demand. Ideal for investors looking to capitalise on both traditional and short-let strategies in one of the UK’s fastest-growing cities. Speak with our team for more details.

6. How to Prepare Before 1 May 2026?

If you’re a current or prospective buy-to-let investor, here’s what to do now:

• Review your tenancy agreements – existing ASTs will convert to periodic automatically, but check your paperwork is up to date;
   
• Provide tenants with the government information sheet – by 31 May 2026 (the template is expected to be published before May);
   
• Ensure your property meets safety standards – gas, electrical, EPC, smoke and CO detectors all need to be current;
   
• Consider your letting strategy – whether long-let, short-let, or hybrid, professional management reduces your compliance burden significantly;
   
• Invest in quality – modern, well-maintained apartments in high-demand locations will perform best under the new framework.

Full Property Management from Rothmore Property

Navigating regulatory changes is easier with the right support. Rothmore Property provides a one-stop service for property investors – from sourcing the right development, through to purchase, furnishing, and ongoing management.

Our sister company, CasaCity, delivers full in-house letting management for both short-let and long-let strategies, including tenant sourcing, property management, market reports, and furniture packs. With over 20 years of experience and access to 60+ developments, our team can help you find properties that are not just compliant – but positioned to thrive under the new rules.

Get in touch today to explore your options.