From Budget to Ban: Section 21’s Final Countdown Under the Renters Rights Act – The Budget squeeze and Renters Rights Act 2025 could reshape your rental plans, here’s what you need to know.
The Renters Rights Act was finally given Royal Assent on 27th October 2025. This is arguably the most significant piece of legislation to affect the private rental sector since the Housing Act 1988 came into force in January 1989.
The provisions of the Act will come into force on 1st May 2026. From that date the Act will apply to all tenancies, even tenancies that existed before that date or have been in existence since as long ago as 1989.
This is the first in a series of short articles concerning the new Act and its impact on all landlords.
There are other significant changes not dealt with during this series, including the establishment of a Private Rented Sector Database (which it will be compulsory to register with to if you rent out residential property) and the Private Rented Sector Landlord Ombudsman to arbitrate tenant’s complaints but the government has not yet set dates for the implementation of those parts of the Act. We will update you when the commencement date for those provisions is known.
The Renters Rights Act is lengthy so I deal in this series with the most important changes (which will apply from 1st May 2026)
The most well publicised provision of the new Act is the abolition of the “no fault” Section 21 ground for possession. After 1st May 2026 this will no longer be a possible method of obtaining possession of a residential rental property. Up until that date Section 21 Notices can still be served but will need to be proceeded upon with Court action as soon they expire to avoid the Notice becoming invalid on 1st May 2026.
This is of importance if you are intending to sell your property in the near future, having considered the tax increases and other changes in the budget announced on 26th November which will significantly affect how much profit you can make from your rental property because generally you will need to be able to sell the property without a sitting tenant.
If you need to obtain possession of your property before selling you may wish to consider using a Section 21 Notice now to ensure that you are able to do so with minimum difficulty and expense.
However you may only use a Section 21 Notice, even under the present regime, if your tenancy paperwork is in order and you have the necessary certificates and evidence. We can advise you as to the required documentation and the correct way forward.
Please do not hesitate to complete an enquiry form on our website and we will send you an initial email to explain how we can help you.
The second most significant change being brought in under the Act is that all tenancies will automatically become periodic monthly assured tenancies on 1st May 2026. That includes existing Assured Shorthold Tenancies which will change overnight to periodic monthly tenancies and no residential tenancies granted on or after 1st May can legally be anything but assured tenancies. Coupled with this will be a bar on taking rent in advance over one month’s rent and it will be illegal to take any rent from a tenant before a tenancy agreement is signed.
We can advise you on the implications of this change on existing tenancies and on any new tenancies after 1st May 2026.
