Understanding the Upcoming Rental Reform: A Guide for Landlords and Tenants
The UK rental market is on the cusp of significant change. Our comprehensive guide breaks down the upcoming rental reform into clear, manageable phases, helping both landlords and tenants understand what to expect and how to prepare for these pivotal updates.
The government is introducing these measures in three distinct phases, aiming to create a fairer and more secure private rented sector for everyone. Let's delve into what each phase entails.
Phase 1: Major Changes from 1 May 2026
The first phase of the rental reform, effective from 1 May 2026, brings about some of the most impactful changes for landlords and tenants alike.
Abolition of Section 21 'No-Fault' Evictions
Perhaps the most significant change is the abolition of Section 21 evictions. This means landlords will no longer be able to evict tenants without a specified reason, providing greater security for renters.
Introduction of Periodic Tenancies
All new tenancies will become periodic from day one, meaning they will roll on a month-to-month basis without a fixed end date. Existing fixed-term tenancies will automatically convert to periodic tenancies once their initial term expires.
Revised Notice Periods
Notice periods for landlords seeking possession will be standardised, generally increasing to two months for most grounds. Tenants will also be required to give two months' notice when ending a tenancy.
Strengthened Possession Grounds
To balance the abolition of Section 21, new and strengthened possession grounds will be introduced for landlords. These include grounds for landlords wishing to sell their property, move in themselves or a close family member, or in cases of tenant misconduct such as rent arrears or anti-social behaviour.
Limits on Rent Increases
Rent increases will be limited to once per year, with landlords required to provide two months' notice. Tenants will also gain the right to challenge excessive rent increases through the First-tier Tribunal.
Banning of Bidding Wars and Advance Rent
Practices such as 'bidding wars' for properties and requests for more than one month's rent in advance will be banned, aiming to make the rental process fairer and more transparent.
Non-Discrimination and Pet Requests
Landlords will be prohibited from issuing blanket bans on renting to families with children or those on benefits. Furthermore, tenants will have the right to request to keep a pet, which landlords cannot unreasonably refuse. Landlords may, however, require tenants to take out pet insurance to cover potential damages.
Phase 2: Late 2026 - PRS Database and Ombudsman
The second phase, expected in late 2026, focuses on enhancing accountability and dispute resolution within the private rented sector.
Private Rented Sector (PRS) Database
A new PRS Database will be established, requiring all landlords to register their properties. This database will include essential information such as the landlord's ID, property details, and proof of compliance with safety regulations. Specifically, landlords will need to upload valid Gas Safety Certificates, Electrical Installation Condition Reports (EICRs), and Energy Performance Certificates (EPCs).
Landlord Ombudsman
A new independent Landlord Ombudsman will be introduced to provide a quicker and cheaper alternative to the courts for resolving disputes between landlords and tenants. All landlords will be legally required to join this scheme.
Phase 3: Future Dates - Decent Homes, Awaab's Law, and EPC Targets
The final phase, with future dates yet to be confirmed, aims to improve housing standards and energy efficiency.
Decent Homes Standard
The Decent Homes Standard, currently applicable to social housing, will be extended to the private rented sector. This will ensure all rented properties meet a minimum standard of quality and safety.
Awaab's Law
Named after Awaab Ishak, Awaab's Law will introduce strict new timelines for landlords to address hazards like damp and mould, ensuring prompt action to protect tenants' health.
EPC C Targets
While specific dates are still under review, the government's ambition is for all rented properties to achieve an Energy Performance Certificate (EPC) rating of C or above. This will drive improvements in energy efficiency, benefiting both the environment and tenants' utility bills.
Preparing for the Future
These reforms represent a significant shift in the UK's private rented sector. Both landlords and tenants should familiarise themselves with these changes to ensure they are prepared. Estate agents are here to help navigate these complexities, offering expert advice and support as the new regulations come into effect.
