Introduction
The Renters’ Rights Bill is poised to deliver the most significant transformation in UK housing legislation in over three decades. With Royal Assent expected imminently, the property industry faces a period of unprecedented change and uncertainty.
While broad support exists for measures aimed at improving housing standards, considerable concern persists about specific provisions within the legislation. For estate agents and property professionals, understanding these changes and their implications is crucial for navigating the evolving landscape.
The Landlord Exodus: A Sector in Crisis
The numbers paint a troubling picture. According to a February 2025 survey by SpareRoom, a record 88% of landlords now lack confidence in the private rental sector—a figure that climbs to 90% in London. More alarmingly, over a third (34%) of landlords are planning to exit the market entirely this year, with a further 29% intending to reduce their portfolio size.
The London market faces even greater pressure, with 42% of landlords indicating plans to leave in 2025. An additional 4% are considering pivoting to short-term holiday rentals, further depleting long-term rental stock.
Matt Hutchinson, Director at SpareRoom, emphasises the human dimension of this crisis: “Not all landlords are big businesses. Almost half (45%) only have one rental property, some of whom have their life savings tied up in their rental property. If landlords feel like they have no choice but to leave the market, renters will suffer.”
The supply crisis is already driving rents upward. If landlords follow through on their intentions, the shortage will intensify dramatically. Hutchinson warns: “It’s evident the current rental market isn’t working for anyone—tenants or landlords. The sector needs change that protects and incentivises supply. If the government wants stability and affordability, then change has to work for everyone.”
The stark reality is that whilst common-sense reforms may offer tenants greater protection, there is neither sufficient support nor incentives for landlords, and nothing in place to protect the market from the volatility we’re witnessing.
Multiple Pressures Driving Landlord Decisions
Investment in the sector has slowed to a trickle, with just 3% of landlords entering the market last year. Nearly half (49%) plan to exit within five years, signalling a long-term crisis rather than short-term turbulence.
Eddie Hooker, CEO of Hamilton Fraser and Total Property, observes that rising costs, increasing regulation, and shifting tenant expectations are fundamentally reshaping the market. The fact that nearly half of landlords are considering a departure within five years reveals how deep these challenges run.
Beyond the Renters’ Rights Bill itself, landlords face mounting financial pressures including reduced profitability in the current market and increased capital gains tax. Government messaging around “rent containment measures”—which many interpret as rent control by another name—has further eroded landlord confidence in the sector’s viability.
Hooker warns that without urgent action to address this exodus as landlords reduce their portfolios, significant and serious detriment to the private rented sector will be unavoidable.
The Agent Perspective: Drowning in Regulatory Change
Estate agents are struggling to keep pace with the volume and complexity of changes. The private rented sector is experiencing its biggest transformation in decades, and agents are finding it almost impossible to maintain compliance whilst continuing to serve clients effectively.
Legislative changes have already taken their toll. Two-thirds of agents report that the Tenant Fee Ban did negatively affect their businesses. The impending Renters’ Rights Bill, particularly the abolition of Section 21 which will apply simultaneously to both new and existing tenancies, remains a key concern.
Many agents feel unsupported by the current Government in addressing these sector challenges. Their biggest concerns include:
- Keeping up with regulatory changes (76%)
- Shortage of rental stock (61%)
- Increased operational costs (46%)
- Energy efficiency requirements (33%)
- Finding suitable tenants (29%)
The Homelessness Risk: Unintended Consequences
A statement from The Lettings Industry Council (TLIC), which supports many proposals in the Renters’ Rights Bill, highlights a critical flaw in the current legislation. For the Bill to work in practice and genuinely benefit tenants, essential changes are required. As it currently stands, the Bill risks contributing to mass homelessness rather than preventing it.
The severe housing shortages that have worsened in the private rented sector over recent years mean tenants struggle to take advantage of additional rights when there is little or no choice of alternative accommodation. Whilst tenants may theoretically be able to enforce their rights, if doing so means choosing to move out of their home, they may be no better off—and potentially worse off—if they cannot find anywhere else to live.
TLIC has called for a cross-party committee to produce a long-term strategy with short-term gains to provide more social housing. With over one million tenants receiving housing benefits—representing 25-30% of the private rented sector—providing more social homes would address many of the issues currently being debated. Without this safety net, the Bill may inadvertently worsen the homelessness crisis it aims to alleviate.
Source: The Lettings Industry Council
Key Provisions of the Renters’ Rights Bill
Tenancy Structure Changes
All tenancies must have a written agreement, but the structure fundamentally changes. Fixed-term contracts will be abolished entirely, replaced by periodic assured tenancies. All tenancies will charge rent monthly or for each 28-day period.
This represents a significant departure from the Assured Shorthold Tenancy (AST) framework that has governed the sector for decades.
The 12-Month Protected Period
Tenants will benefit from a 12-month protected period at the start of any tenancy, during which landlords cannot evict them to move in themselves or to sell the property. After this period, tenants can remain in their home indefinitely until they choose to end the tenancy by giving two months’ notice.
However, the threshold for mandatory evictions due to rent arrears will increase to three months.
Restrictions on Rent and Deposits
Several new restrictions will apply:
- Rental bidding will be prohibited
- Landlords cannot take rent in advance before the agreement is signed
- Advance rent requests will be limited to one month maximum
- Within-tenancy rent increases will be limited to once per year
- Rent increases must be limited to market rate and conducted exclusively via the Section 13 process
- Tenants can challenge unfair rent increases at the First-tier Tribunal (though Tribunals cannot increase rents beyond what the landlord originally requested)
Enhanced Property Standards: Awaab’s Law Extension
Awaab’s Law, named after two-year-old Awaab Ishak who died from prolonged exposure to mould in social housing, will extend to the private rented sector. This requires landlords to address hazards such as damp and mould within specified timeframes.
Civil penalties for failing to comply with regulatory requirements will increase substantially:
- Breaches: from £5,000 to £7,000
- Offences: from £30,000 to £40,000Source:
UK Government Guide to the Renters’ Rights Bill
The Section 21 Abolition: Strengthened Landlord Grounds?
The most controversial element remains the abolition of Section 21, which currently allows landlords to regain possession without stating a reason. According to the Ministry of Housing, Communities and Local Government (MHCLG), whilst ending Section 21 evictions will give renters more security and stability, landlords will retain strengthened rights to reclaim properties when necessary—for example, to sell or move in themselves—through mandatory Section 8 grounds.
Whether the court system has the capacity and resources to support this assertion in practice remains highly uncertain.
The Road Ahead: Challenges and Uncertainties
The Renters’ Rights Bill represents the most significant overhaul of the UK’s housing legislation since the Housing Act 1988. For estate agents and property professionals, the change requires careful preparation, robust systems, and clear communication with both landlords and tenants.
The sector faces a delicate balancing act: implementing reforms that genuinely improve conditions for tenants whilst maintaining sufficient incentives for landlords to remain in or enter the market. Without achieving this balance, the unintended consequences—reduced supply, higher rents, and increased homelessness—could undermine the very goals the legislation seeks to achieve.
Staying informed, adaptable, and proactive will be essential for all property professionals navigating this new landscape.