The Renter's Rights Act: What to do now?

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In last week's post, we spoke about what the Renter's Rights Bill means to you. Have a read of it before this one because it will help lay some foundational knowledge before we get into the details as the weeks go by. Skipping the first one means what I write below may not make much sense.

Since the Renter's Rights is now longer a bill, it is now called the Renter's Rights Act. The Government has launched the Renter's Rights Act Guide.

In case anyone has missed it, the days of the "accidental landlord" or so called hands-off property investor is over. I'll talk about that in a bit.

We promised to share with you some plans so this is what this week's newsletter will cover.

But first, let's cover off some myths.

Myths

Fear 1 - Letting to benefit recipients or people with children will breach the terms of my mortgage.

Fact 1 - The Act will make restrictions on renting to families in mortgage agreements invalid, so the landlord cannot be considered in breach.

Fear 2 - Can I evict my tenant if they break the terms of their tenancy agreement?

Fact 2 - All landlords want to find and keep good tenants. However, if a tenant fails to pay rent or break the terms of their tenancy, they can be evicted. Evidence is needed if it goes to court; therefore, effective management will be essential.

Fear 3 - Can I evict my tenant if they fail to look after my property?

Fact 3 - Using a qualified, reputable letting agent will help you find suitable tenants. At TNM, we are accredited to the highest standards through Propertymark for both lettings and estate. However, if a tenant breaks the terms of their tenancy, they can be evicted.

Fear 4 - Without Section 21, I can't get my property back if l want to sell it or move in myself.

Fear 4 - Yes, you can. Section 8 grounds for possession would mean you can gain possession to either move in or sell your property with four months' notice.

Fear 5 - As a landlord I'm being held to ever-higher standards. Am I better off just selling?

Fact 5 - Landlords have a duty of care to provide a safe home. Housing safety standards are there to make the expectations clear and identify those landlords who don't comply, making the sector fairer to those who do. Using a Propertymark agent like TNM means less to worry about.

Fear 6 - In-progress Section 21 evictions will become invalid.

Fact 6 - If the court has been asked to issue a claim for possession using Section 21 before the commencement date of the Act, it can still go ahead.

Fear 7 - Won't the Private Rented Sector Database just make it easier to penalise landlords?

Fact 7 - No, you'll be able to access guidance and support so that you understand the law. TNM as your agent is here to support you.

Fear 8 - The Act forces agents and landlords to allow pets without protections.

Fact 8 - A landlord will be able to request more information about the pet and will have a set number of days to give or refuse consent in writing.

Fear 9 - I'll no longer have control of who lives in my property.

Fact 9 - A good lettings agent will have robust vetting in place which includes affordability, referencing and Right to Rent.

Fear 10 - Without fixed-term tenancies, my tenants will be able to leave whenever they want.

Fact 10 - Tenants must provide two months' notice to leave, giving landlords more time to prepare for a new tenant. Currently, most periodic tenancy agreements are only one month notice.

The writing on the wall

For me, the writing has been on the wall as early as 2008, after the first financial crisis when there was a change in trajectory to gradually move property as an asset class more towards institutional investors.

2008–2010 | LHA reforms (and freezes from 2011)

Stepwise reductions and caps to Local Housing Allowance tightened viability for low-income lets, especially where yields were marginal. Signal: policy starting to squeeze easy returns reliant on LHA.

2010 | Capital Gains Tax rise (higher-rate to 28%)

Not landlord-specific, but raised the tax take on investment gains, including buy-to-let. Signal: less generous treatment of investment profits.

2010–2012 | Article 4 Directions for HMOs (planning)

Some councils began using Article 4 to remove permitted development rights for C3 to C4 conversions, forcing a planning application for new small HMOs. This did not become mainstream planning tool until 2015. Signal: local authorities actively managing HMO proliferation; easy “add bedrooms, print yield” strategies faced planning friction and refusal risk.

2013–2015 | Macro Risks - Bank of England

The Financial Policy Committee was empowered to lean against housing risk; BTL stopped being treated as a benign wealth play and started being treated as a macro risk to be managed. Signal: central bank oversight moving squarely onto BTL leverage.

Apr 2016 | SDLT 3% surcharge on additional dwellings

A direct cost shock to portfolio growth and remortgage-and-repeat models. Signal: government preference to cool investor demand.

Sep 2016 | BTL underwriting standards

Tougher affordability stress-tests and portfolio-landlord scrutiny made thin-margin, interest-only strategies much harder to scale. Signal: professionalisation of credit standards; harder to cash flow and make deals stack.

2015 (phased from 2017–2020) | Section 24

Mortgage interest relief restricted to a basic-rate credit. Signal: leveraged, higher-rate taxpayers see after-tax yields compress sharply.

2018+ | Minimum Energy Efficiency

Minimum E rating to let; enhanced property standards and compliance culture. Signal: capital expenditure and asset-management mindset required, not set-and-forget.

2019 | Tenant Fees Act

Bans most upfront tenant fees; agents / landlords have to absorb some costs and sharpen operations. Signal: customer-standards and compliance first.

2020 | Electrical Safety Standards in the PRS

Mandatory EICRs for most private lets. Signal: scheduled safety compliance becomes ongoing business as usual.

2022 | Building Safety Act (for higher-risk buildings)

Not universal, but a clear direction toward stronger safety governance. Signal: governance, records, accountability.

2025 | Renters’ Rights Act (formerly Bill) and Awaab's Law — system reset

Complete overhaul, business sector change requiring new mindset or market exit. Signal: a wholesale shift to regulated, documented, professionalised service with compliance as the ticket to operate.

The end of Section 21 no-fault eviction

A Section 8 notice will be the only way for landlords to regain possession of their properties, so familiarise yourself with the Section 8 grounds, both mandatory and discretionary grounds have been updated.

Landlords will have to provide evidence to justify every possession claim. Therefore, keep detailed records of all tenant communication, repairs and any rent arrears, including dates and amounts.

Ensure the deposit is protected correctly at the start of the tenancy so the possession order is not rejected; this is particularly relevant when landlords are claiming rental arrears.

At TNM, we are now communicating with tenants on CoHo so that there is a clear and auditable communication trail. We will also be launching a new Management PLUS service where the agency will handle both the deposit and rent collection for landlords.

We also have a robust, in-person check-in process to ensure all tenants sign-up to a code of conduct.

Periodic tenancies

The transition from ASTs to periodic tenancies will require an update to all existing and future agreements.

Any attempt to create a fixed term or use a break clause or notice to quit is an offence.

At TNM, we the have a system to manage tenant notices to ensure properties are re-let quickly. Tenants notify us on CoHo which kicks into motion the process of negotiating exit terms > property market appraisal > re-listing > viewings > check-out > property turn-around > contracting > check-in.

Changes to rent increases

Rent reviews are very much a personal choice. We know landlords who never increase rent (not advised), some landlords who increase every year without fail and some increase every so often. We expect to handle a much higher volume of rent reviews so have set up a process to link potential rent reviews with property inspections. This way, the Agency can and the tenant get to have a face-to-face conversation to understand if continued tenancy works for both parties.

Rent increases are based on local market conditions (prices of similar properties let in the area or from other data sources) to avoid disputes, and this can be evidenced this. The Agency will keep clear records of rent changes and justifications, as well as keep an audit trail of when Section 13 notices were issued.

Rent in advance

The UK Government is clear that landlords and letting agents should consider a tenant’s individual circumstances when negotiating rental conditions.

Where a tenant cannot satisfy pre-tenancy checks, a landlord can require a tenant to provide a guarantor.

While landlords will be restricted from including terms in a tenancy agreement which require rent to be due in advance of the rent period to which the rent relates, tenants will remain free to pay before the rent due date should they wish to do so.

From an agency perspective, there is no change in our operation here. If a tenant does not meet the require criteria, then proceeding even with a guarantor is just potentially deferring issues until later.

Ban on rental bidding

If there is no advert for the property, then the amount must be specified in the written offer. Some landlords may consider setting slightly higher rents upfront. While this is permitted, it must be balanced against tenant affordability and local demand to avoid prolonged vacancies.

At TNM, we will stay compliant by advertising properties at a fixed rent, avoiding informal negotiations above the listed price and keep clear records of all offers and communications.

Private Rented Sector Database

Landlords and their properties must be registered on the Database before they can be let, or before they are advertised or marketed for let. Database identification numbers for landlords and rented property must be included in adverts.

TNM will work with landlords to ensure they and their properties are registered. Agents who advertise unregistered properties can face civil penalties of up to £7,000 for a first offence, with fines potentially reaching £40,000 for repeat offences.

Landlords who fail to comply with duties such as registering on the national landlord/property database is also liable to be fined up to £7,000 for a first or minor offence, and up to £40,000 for serious or repeated non-compliance.

Meeting the Decent Homes Standard

At TNM, we adopt a risk based approach to carrying out property inspections and pay close attention to common issues such as damp, heating and ventilation. In fact, we routinely attend on behalf of or with landlords on local authority property inspections and are regularly praised for the standard of our management.

As landlords, we recommend that you review EPC ratings and begin planning for energy efficiency improvements.

As an Agency, we will support you in ensuring all gas, electrical and fire safety certificates are in place. We pride ourselves in being compliance experts, regularly identifying serious compliance gaps when asked by landlords to take over management from other agencies.

Awaab’s Law represents a vital step forward in protecting tenants’ health and safety. While it currently applies to social housing, the Renters’ Rights Act extends these same duties to all rented homes, placing clear timeframes on landlords to act swiftly when hazards are identified.

As a responsible and values-led agency, we’ve always urged our landlords to tackle damp and mould issues promptly, especially where causes go beyond tenant lifestyle. It’s not just the right thing to do; it’s now a legal requirement. Under the new rules, emergency hazards must be remedied within 24 hours, and significant hazards within two weeks.

On the rare occasions where landlords have failed to meet their legal and moral obligations, we’ve made the difficult decision to terminate management rather than compromise our standards.

We will continue to use CoHo to maintain transparent, time-stamped records of all maintenance and repair activity; ensuring full accountability and compliance with the new law.

New Private Rented Sector Ombudsman

Landlords will be required to pay a small annual fee per property to the Ombudsman.

Landlords and agents will remain responsible for their own actions and behaviours, as well as the respective services they have agreed and are legally bound to provide to tenants. Tenants and landlords will still be able to complain about agents and receive redress through the existing agent redress schemes.

This is no change for the Agency and it is an extension of what Agents already have to sign up to, now being applied to Landlords as well.

Stronger protection against tenant discrimination

We are continuously reviewing our tenant referencing and screening processes. Our focus has always been and remains on affordability, income, references and credit history only when assessing applicants.

Renting with pets

Landlords will be required to fully consider all requests on a case-by-case basis. We will work with landlords to develop a fair pet policy based on the suitability of the property and the type of pet.

We will have a process to respond to pet requests from tenants because they must be responded to within 28 days.

Stronger local authority enforcement

At TNM, we will continue to carry out an inventory and check-in and out report on all tenancies at no additional cost. We will also continue to conduct a risk based approach to property inspections to ensure ongoing compliance.

We will continue to keep records of all property checks, quotes, invoices and communications. This will only improve as CoHo continues to be imbedded into our systems and working practices.

As an Agency, the directors and contractors are expected to evidence ongoing CPD to stay ahead as enformentment becomes stricter. We now have two dedicated Property Managers who know many of the local authority inspectors and the agency has a reputation for a compliance focused high standards management.

As finer details of the Act starts to emerge, I will write more. I have a keen interest in compliance and the law, so I have been rather sad and ordered myself a hardcopy of the Act which costs about £50. It hasn't arrived yet, so for now, I will use each newsletter to focus on one element of the Act and take a deeper dive in it to determine what it really means practically for us as Agency, and for you as Landlords or Tenants.

TNM - "Always doing the right thing."

Disclaimer: This newsletter is for general information only and does not constitute legal, financial or other professional advice. No representation or warranty is given as to its accuracy or completeness and, to the fullest extent permitted by law, Tu Nguyen Management Limited accepts no liability for any loss arising from reliance on it, including any errors or omissions.