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The Renters' Rights Act 2025 is the largest change to English tenancy law in a generation. It received Royal Assent on 27 October 2025, and its core reforms took effect on 1 May 2026. For a landlord who lives abroad and owns a city-centre apartment through a letting agent, most of the change happens on paper. The tenancy works differently, rent rises follow a formal process, and possession needs a legal reason. What matters is whether your agent has adapted, and whether your plans for selling still work.
This guide covers England only. Scotland and Wales have their own systems.
What changed on 1 May 2026?
Before | From 1 May 2026 |
|---|---|
Fixed-term assured shorthold tenancies, often 12 months | Every tenancy is assured and periodic, rolling month to month |
Section 21 "no-fault" notice to end a tenancy | Abolished. Possession needs a section 8 ground |
Rent review clauses in the agreement | Rent rises once a year, only by section 13 notice |
Tenants could be asked for several months' rent upfront | No more than one month's rent in advance |
Bidding above the advertised rent | Banned |
Tenant tied in for the fixed term | Tenant can leave on two months' notice |
Existing tenancies converted automatically on 1 May 2026. Landlords had to give existing tenants the government's information sheet on the Act by 31 May 2026.
How do rent increases work now?
You can raise the rent once in any 12-month period by serving a section 13 notice in the prescribed form, with at least two months' notice. Increases by email, letter or a clause in the agreement no longer have effect. The tenant can refer the increase to the First-tier Tribunal, which decides the market rent and cannot set it above the figure you proposed.
In practice, this rewards pricing at the market. A rent in line with comparable flats in the building will rarely be challenged. An aggressive increase invites a tribunal referral and, now that tenants can leave on two months' notice, a void.
Can I still sell, or move back in?
Yes, but on a timetable.
- Selling with vacant possession (ground 1A): four months' notice, and not within the first 12 months of the tenancy. Once you have used this ground you cannot re-let the property, or market it for letting, for 12 months.
- Moving in yourself or for a close family member (ground 1): the same four months' notice and first-year restriction apply.
- Selling with the tenant in place: no ground needed. The tenancy continues under the buyer. For city-centre apartments this is often the better exit anyway, because the buyer is usually another investor who wants an income from day one.
If you plan to sell within a year or so of buying, or to use the apartment yourself on a visit, build this into your plans now. A short-let or Airbnb-style arrangement after using the sale or move-in ground is also caught by the 12-month restriction.
What about tenants who stop paying?
The mandatory arrears ground (ground 8) now needs at least three months' rent outstanding, both when the notice is served and at the hearing, with four weeks' notice. Before the Act it was two months, with two weeks' notice. Rent guarantee insurance and careful referencing, both normally arranged by your agent, matter more than before.
On the market in United KingdomSmithfield HouseBirmingham, United KingdomFrom £229,995See the developmentWhat is still to come?
Change | Expected |
|---|---|
Private rented sector database: every landlord and property registered before it can be marketed | Registration from late 2026; fully operational not before 2027 |
Landlord ombudsman: compulsory membership | Around 2028 |
Decent Homes Standard extended to private rentals | 2035 |
When the database opens, an unregistered property cannot be advertised. Make sure your agent registers you as soon as registration opens, and that your contact details as an overseas landlord are kept current.
What does this mean for an overseas landlord's yield?
For a modern, well-managed apartment in a city centre such as Manchester, the effect on yield is small, and in some respects positive.
- Longer tenancies. Tenants who are not on a fixed term often stay longer, which reduces voids and re-letting fees.
- Steadier rent growth. Annual section 13 increases at market level are still possible; what disappears is the opportunistic mid-tenancy rise.
- Less flexibility. You can no longer recover possession quickly for convenience. That matters most to landlords who might want the flat back or might need to sell vacant at short notice.
- More compliance cost. Agents are charging for the extra administration, and fines for breaches are now material.
The landlords most exposed are those with older stock, high turnover and informal management. Good buildings with good management are least affected. That is one more reason to buy new-build or recent stock in strong rental districts. See Manchester rental yields for how net yields compare by building type.
A compliance checklist for landlords abroad
- Use an accredited letting agent that has rebuilt its tenancy documents and processes for the Act.
- Make sure each tenant has received the prescribed information, and keep proof.
- Keep the gas safety record, electrical installation report, EPC and deposit protection certificate current, and stored where you can see them.
- Register on the private rented sector database as soon as registration opens.
- Serve rent increases only by section 13 notice, once a year, at market level.
- Answer pet requests in writing within 28 days, checking the head lease.
- Register with HMRC's Non-Resident Landlord Scheme so that rent can be paid without 20% tax deducted, if you are eligible.
- Plan any sale at least 16 months ahead if you will need vacant possession.
How this fits with tax changes
The Act arrived alongside the Autumn Budget 2025 changes, which raise property income tax rates to 22%, 42% and 47% from April 2027. For an overseas landlord the two together argue for fewer, better properties rather than many marginal ones. Our UK property taxes guide sets out the tax side, and the UK rental yields guide shows how to measure the net return.
