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Renters’ Rights Act 2025
The Renters’ Rights Bill has passed both Houses of Parliament, received Royal Assent on 27th October and has been enacted as the Renters’ Rights Act 2025 (“Act”). This confirms an imminent and material reform of the private rented sector and sets out significant changes for landlords, tenants and the professionals who advise and work with them.
Abolition of Section 21
The Act will abolish Section 21 ‘no fault’ evictions. Once implemented (this is yet to be confirmed, but expected to be early 2026), landlords will only be able to regain possession if they can satisfy the revised Section 8 grounds. Whether a tenancy is new or existing, the former ‘no fault’ possession route will no longer be available. Tenants will benefit from a protected 12-month period during which eviction simply to sell or move in will be unavailable. Landlords who rely on turnover to manage portfolios will need to reassess their exit strategies and operational planning.
Notice Periods
Notice periods for possession based on rental arrears will increase. The minimum notice landlords must give before commencing possession proceedings will double to four weeks. Landlords will be able to seek possession for rent arrears only once arrears reach an increased minimum threshold of three months.
Rent Increases and Dispute Resolution
The Act prescribes a statutory procedure for rent increases. Tenants may apply to the First-tier Tribunal where they consider a proposed increase is unreasonable. The Act introduces enhanced regulatory oversight by requiring every landlord to register on a dedicated Private Rented Sector Database and establishes an Ombudsman to provide tenants with a less adversarial route for resolving disputes.
Awaab’s Law
Awaab’s Law will impose a positive obligation on landlords to address hazards such as damp and mould promptly. Failure to remedy hazards may attract civil penalties and increased enforcement action.
Pets
Tenants will have the right to request permission to keep a pet, and landlords can only refuse with good reason. A landlord can reasonably require the tenant to take out pet insurance. These provisions should be reflected in all new tenancy agreements.
Bidding, short‑term lets and Enforcement
The Act will prohibit rental bidding to foster transparent and fair lettings, although most short‑term lettings will fall outside this prohibition. Local authorities will gain strengthened enforcement powers, including the ability to levy penalties for breaches of landlord obligations.
Recommendations
Given the imminent changes, it is vitally important that landlords (and their agents) urgently review their portfolios and take advice on redrafting standard tenancy agreements, meeting new compliance and regulatory requirements, and updating staff training and operational procedures.
Tenants should scrutinise rent increase notices, retain comprehensive records of all communications with landlords and managing agents and obtain timely legal advice where persistent damp or mould arises or where possession proceedings are threatened.
Conclusion
The Act marks a fundamental overhaul of rental law, delivering greater statutory protections for tenants and substantially expanded duties and compliance obligations for landlords.
To discuss any of the points above or to obtain advice on property matters, please contact Daniel Blake, a Property Litigation Partner in our Dispute Resolution team, or fill out the form below.
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Leasehold and Freehold Reform Act 2024 – January 2025 Update
Implementation of changes to ownership requirement rules
On 21 November 2024, Matthew Pennycook MP (the Minister for Housing and Planning) confirmed the Government would imminently introduce new regulations to abolish the two-year ownership rule for i) a leaseholder of a flat to extend their lease; and ii) a leaseholder of a house to extend their lease or purchase the freehold.
It has now been confirmed that these changes will be implemented this Friday, 31 January 2025.
Up until now, it has been regular practice for sellers of long leasehold properties to apply for a statutory lease extension (in accordance with the Leasehold Reform, Housing and Urban Development Act 1993) and immediately assign the benefit of the claim to the buyer upon completion. This procedure provided a framework for buyers to legitimately circumvent the two-year ownership rule before they could bring their own claim. As of this Friday, these steps will no longer be required.
Buyers will now be able to make a statutory claim for a new lease as soon as they become the registered proprietor of the leasehold title at HM Land Registry. This point is noteworthy given HM Land Registry continues to experience a significant backlog of applications, resulting in an extended ‘registration gap’ – the period between completion and subsequent registration of the transaction at HM Land Registry.
Accordingly, buyers will be prevented from exercising these rights immediately upon completion and not until registration of the legal title has been effected at HM Land Registry. This may result in some buyers not wishing to wait, in which case they will have to follow the current practice of the seller giving notice of the claim with the benefit being assigned to them upon completion.
Conclusion
Subject to potential delays resulting from the ‘registration gap’, these changes should empower leaseholders to enfranchise at their own convenience and without the potential pressure of having to undertake the exercise at the point of acquisition.
Whilst the removal of the two-year ownership requirement will be welcomed by both buyers and sellers of leasehold properties, other proposed legislative changes introduced by the Leasehold and Freehold Reform Act 2024 are yet to be implemented. For example, buyers will still be faced with uncertainty as to whether a claim should be pursued under current valuation rules or to await implementation of the new provisions. We await further developments with interest.
To discuss any of the points raised in this article, please contact Daniel Blake or fill in the form below.
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