The new act introduced: 

A new standard tenancy for private renting

A Decent Homes Standard and new rules on responding to hazards.  

Changes to advertising and letting practices.

Limits on when and how much rent can be taken in advance

The removal of Section 21 notices for possession

Changes to Section 8 grounds for possession

Changes to rent increases

A new private rented sector database and Ombudsman that landlords must sign up to

New offences and civil penalties for landlords who don’t comply with these rules

The headline-grabbing change is the proposed abolition of Section 21 evictions, the so-called no-fault evictions.

Section 21 allowed landlords to regain possession of their property without giving a reason, subject to notice periods. Now, under the Act, all tenancies will move to a single system of periodic tenancies, and landlords will need to use a revised Section 8 process to regain possession. Landlords will now need to cite specific grounds such as rent arrears, antisocial behaviour or the landlord’s intention to sell or move in.

This change requires landlords to be more structured in their record-keeping and tenant management. Robust documentation and a clear understanding of the legal grounds for possession will be essential.

Tenancy structures

All Assured Shorthold Tenancies (ASTs) will become periodic, meaning there will no longer be fixed-term agreements. Tenants will be able to leave with two months’ notice, while landlords will need to use a statutory reason to end the tenancy. This increases flexibility for tenants, but it may cause uncertainty for landlords more used to fixed-term arrangements that guarantee rental income for a set period.

As a result, landlords may need to revisit their cashflow projections, particularly where borrowing or tax planning is involved. Regular reviews of tenancy agreements and financial forecasts will be important.

The revised Section 8 regime will expand the grounds for possession. These include new provisions for landlords wishing to sell the property or move in themselves (or for close family). While this provides a legitimate route for regaining possession, strict notice periods and evidentiary requirements will apply.

New property standards

The Act also introduces a new Private Renters’ Ombudsman and requires all landlords to join a redress scheme. Additionally, a Decent Homes Standard will be applied to the private rented sector, setting minimum property standards similar to those already used in social housing.

Alongside the Act, Awaab’s Law will be extended to private landlords, requiring them to address damp and mould within a specific timeframe.

These changes will inevitably create additional costs and compliance for landlords, particularly those with older properties, and comes at a time when many of the tax advantages of owning property have been eroded.

Landlords are advised to understand how these changes will affect properties in their portfolio, the costs of meeting this legislation and the impact it will have on their cashflow and tax position.

If you would like bespoke advice from one of our specialists, please do not hesitate to get in touch.