Renters' Rights Act 2026: What Changed for Investors Letting Property in London

Since 1 May 2026, letting a home in England has worked differently. The Renters' Rights Act abolished "no-fault" eviction (Section 21), ended fixed-term tenancies and limited rent increases to once a year. If you own, or plan to let, a property in London, these changes affect both your yield and your exit plan.

This article is not legal advice. Its purpose is to explain the change plainly, based on official sources.

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When, and who is covered?

The first phase came into force in England on 1 May 2026. It covers assured and assured shorthold tenancies in the private sector. Council and housing association tenants, student halls and lodgers are outside it.

One detail matters in prime London: according to the GOV.UK guide, tenancies with annual rent above £100,000 are outside its scope. If you are letting at the very top of the Knightsbridge or Mayfair market, ask your solicitor which regime applies.

1. Section 21 has gone

Landlords can no longer serve a Section 21 notice to evict without giving a reason. Possession is only available on a ground set out in law, through a Section 8 notice and, if needed, a court process.

Section 21 notices served on or before 30 April 2026 remained valid. If the tenant had not left by the date in the notice, the landlord could apply to court until 31 July 2026.

2. No fixed terms: every tenancy is periodic

All new tenancies and most existing ones are now assured periodic tenancies. Fixed terms ending after 1 May 2026 became periodic on that date. You can no longer create an assured tenancy with an end date.

A tenant who wants to leave gives two months' written notice. The era of the "guaranteed 12-month let" is over, so void periods need to be rethought in your yield model.

3. Possession to sell or move in: longer timelines

A landlord who wants to sell, or to move in themselves or with family, can seek possession on a legal ground. There are two limits:

• These grounds cannot be used in the first 12 months of a tenancy.
• On the sale ground (Ground 1A) the notice period is at least four months. A landlord who regains possession on this ground cannot re-let the property for the following 12 months.

The National Residential Landlords Association advises allowing 16 months in total from serving a sale-ground notice before the property can be let again. Build this timeline into your exit plan from the start. Our guide to selling London property and exit strategy helps here.

4. Rent increases once a year

Rent can rise once every 12 months, with at least two months' written notice. A tenant who thinks the increase is above market value can challenge it at the First-tier Tribunal.

5. Rent in advance and the bidding ban

• No rent can be taken before the tenancy is signed. Between signing and the start date, landlords can ask for no more than one month's rent. Once the tenancy has begun, rent cannot be demanded before it is due.
• Adverts must state the rent. Landlords and agents cannot ask for, encourage or accept offers above that figure.

The "take a year's rent upfront" model familiar to many overseas investors no longer works in England.

6. Pet requests

A tenant can ask in writing to keep a pet. The landlord must consider the request within a set timeframe and give valid reasons if they refuse.

7. New obligations and penalties

Existing tenants had to be given the government's Renters' Rights Act Information Sheet 2026 by 31 May 2026. According to Lewisham Council, failing to do so can lead to a fine of up to £7,000.

Two further steps are coming. According to council guidance, a private rented sector Ombudsman and a national database where landlords register their properties are expected in late 2026. Dates for applying the Decent Homes Standard to private rentals, and for Awaab's Law on damp and mould, have not yet been confirmed.

Rules that have not changed but are often missed

• A tenant's deposit must be placed in a government-approved scheme within 30 days (Deposit Protection Service, MyDeposits or Tenancy Deposit Scheme).
• The deposit cannot exceed five weeks' rent where annual rent is under £50,000, or six weeks' rent where it is £50,000 or more (Tenant Fees Act 2019).
• A let home must have an EPC rating of at least E today. In its Warm Homes Plan, published in January 2026, the government said the bar will rise to C by 1 October 2030, with a spending cap of £10,000 per property. The detail will be set in regulations.
• Landlords living abroad fall under the Non-Resident Landlord Scheme. The letting agent deducts tax from the rent unless HMRC has given written approval to pay it gross.

What this means for overseas investors

Our view: a let London property is still an asset that produces regular income in sterling. But the "buy, let, forget" era is over. Three things matter more than before:

1. The right letting agent and property management. Penalties for breaches fall on the landlord. Our guide to choosing a letting agent in London explains what to look for.
2. A net yield calculation. Voids, longer possession timelines and a single annual increase all belong in the model. Use the net yield approach in our gross vs net rental yield guide.
3. Planning the exit at purchase. Sell with the tenant in place, or with vacant possession? That decision now needs to be made months in advance.

If you would like a review of a property you let, our Private Office property management team can help.

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Sources

• GOV.UK, Renting is changing: private tenants
• GOV.UK, Renters' Rights Act: an overview for landlords
• NRLA, Renters' Rights: possession and ending a tenancy
• Lewisham Council, Renters' Rights Act
• GOV.UK, Deposit protection schemes and landlords
• legislation.gov.uk, Tenant Fees Act 2019, Schedule 1
• GOV.UK, Minimum energy efficiency standard: landlord guidance
• Simmons & Simmons, The Warm Homes Plan & MEES: EPC C by 2030
• GOV.UK, Paying tax on rent to landlords abroad

This article is for general information only and is not legal or tax advice. Information is correct as of 17 October 2026.