The Renters’ Rights Bill is a major piece of legislation currently progressing through Parliament. It aims to reform the private rented sector in England. Although the timeline has shifted, the Bill is expected to receive Royal Assent in summer 2025, with implementation between October 2025 and January 2026.
The Bill introduces some major changes which will have a significant impact on the Build-to-Rent (BTR) sector, including:
- Abolition of fixed term tenancies.
- No more ‘no-fault’ evictions.
- Tenants’ rights to keep pets.
- Stricter rent review rules.
- New private rented sector database.
Fixed term tenancies abolished
All assured tenancies and assured shorthold tenancies (ASTs) (new and existing) will become periodic (i.e. monthly rolling). Landlords will no longer be able to enter into fixed term contracts and tenants will have increased flexibility and be able to leave at any time, on two months’ notice. The motivation behind this change is to:
- ensure that tenants don’t get trapped in poor quality housing; and
- accommodate tenants’ changing circumstances.
As a result, landlords may face:
- higher tenant turnover, plus the associated costs:
- loss of rent for void periods
- increased cleaning and repair costs
- legal and admin re-letting costs
- unpredictable income due to uncertain tenant durations.
However, the BTR sector should generally be in a better position to navigate the upcoming changes compared to individual private landlords. BTR properties are typically built to a very high standard and offer a range of amenities, which enhance tenant satisfaction and should ultimately result in longer tenancies.
No more ‘no-fault’ evictions
The reform marks the end of section 21 ‘no-fault’ evictions. Landlords will no longer be able to evict tenants without a valid reason. They will only be able to remove a tenant if they can satisfy one of the grounds for possession under Schedule 2 of the Housing Act 1988. A section 8 notice will also need to be served.
The grounds for possession that might apply to the BTR sector are:
Mandatory grounds (the court must grant possession if proven)
- Ground 2: Sale by mortgage lender – If the lender exercises power of sale, landlords must give at least four months’ notice to tenants.
- Ground 6: Redevelopment/ renovation – The landlord intends to demolish, redevelop or carry out substantial works to the property.
- Ground 7A: Anti-social/ criminal behaviour – In any instances where the tenant has engaged in serious anti-social or criminal behaviour, landlords will be able to issue proceedings immediately after serving notice.
- Ground 8: Serious rent arrears – If the tenant is in at least three months’ rent arrears, landlords must give four weeks’ notice.
Discretionary grounds (the court may grant possession if proven)
- Ground 10: Rent arrears – If the tenant is in rent arrears at the time of the notice or hearing, landlords must give four weeks’ notice.
- Ground 11: Persistent rent arrears – Landlords must give four weeks’ notice when the tenant has persistently delayed rent payments, even if they are not currently in arrears.
- Ground 12: Breach of tenancy – Any breach of tenancy, other than non-payment of rent, sees landlords having to give two weeks’ notice.
- Ground 13: Deterioration of property – If the tenant has allowed the property to deteriorate, landlords must give two weeks’ notice.
- Ground 14: Anti-social behaviour – The tenant or their visitor has engaged in anti-social behaviour. Landlords can issue proceedings immediately after serving notice.
- Ground 15: Deterioration of furniture – In furnished properties only, if the tenant has damaged the furniture, landlords must give two weeks’ notice.
Top tip for landlords
If landlords can rely on multiple grounds for possession, the chances of successfully regaining possession increase significantly.
Pre-conditions for possession
For the court to consider awarding possession under one of the specified grounds, the landlord must have:
- a valid ground for possession;
- given sufficient notice before issuing proceedings;
- given written notice at the outset of the tenancy that they may want to regain possession under a particular ground;
- protected the tenant’s deposit; and
- provided details for the private rented sector database.
Caught between the old and new rules?
If landlords serve a section 21 or section 8 notice before the Bill is passed, but it is still ongoing when the Act comes into force, any extant notices will remain valid and the tenancy will remain an AST until possession proceedings have been concluded. If landlords haven’t yet issued proceedings, they need to make sure they do so within time or the notice will lapse.
Pets: a new legal right
Historically, landlords have incorporated no-pet clauses into tenancy agreements and have had the right to refuse tenants’ requests for pets.
The new legislation will give tenants a legal right to ask for permission to keep pets. It will become an implied term in every assured tenancy, even if the wording currently prohibits pets.
This might be concerning news for landlords, particularly those who operate BTR, as the accommodation is generally built to a very high standard, and they will be keen to avoid any potential damage to the property.
Landlord consent for pets
Tenants cannot keep pets without landlord consent, unless their tenancy agreement allows this. However, landlords cannot unreasonably refuse consent and have 28 days to give their decision after the request is made. They can request additional information from the tenant which will give them a further seven days to consider their decision. If the tenant fails to provide the information, the landlord does not have to give its decision.
The draft bill sets out two specific reasons a landlord can use to refuse a pet:
- If it would put the landlord in breach of an agreement with a superior landlord.
- If superior landlord consent has been sought but not provided (note – superior landlords have no obligation to not unreasonably refuse consent).
It is envisaged that over time, case law will establish ‘reasonable’ reasons to refuse consent. The concept of limiting pets to only certain areas within buildings is unlikely to hold weight.
How can landlords protect their position?
- Review superior lease terms: If there is a superior lease, landlords should check whether the lease prohibits pets. If it does, this may provide a valid reason to refuse a tenant’s request.
- Require pet damage insurance: Landlords may wish to include a standard clause in tenancy agreements requiring tenants to hold insurance that covers damage caused by pets.
- Recover insurance costs: Alternatively, landlords can request a reasonable payment from the tenant to cover the cost of the landlord taking out such insurance themselves.
- Include conditions of consent: Landlords might also wish to include conditions of consent for pet ownership around cleaning, noise and ensuring the pet is well-trained.
If there are issues, landlords will be able to consider pursuing eviction under some of the discretionary possession grounds: ground 2 (breach of tenancy), grounds 13 and 15 (damage to property/ furniture) and ground 14 (anti-social behaviour, which could include excessive noise i.e. dogs barking).
Stricter rent review rules
Under the new rules, landlords will only be able to increase rent once every 12 months by serving a formal section 13 notice. Tenants will have the ability to apply to the First-tier Tribunal (FTT) to challenge the proposed rent.
It is important to note that this annual rent increase only applies to the same tenancy – if a tenant only stays for six months and a new tenant comes in, the landlord can set a new market rate at the start of that new tenancy. There is therefore a potential for landlords to benefit from more frequent tenant changes.
How long will the rent review process take?
The overall timeframe for a rent review by the FTT is typically three to five months from the date the tenant makes its application. This includes listing the hearing (usually within eight to 16 weeks), followed by a decision within six to ten weeks after the hearing, though delays can occur if the tribunal has a backlog or if an inspection is required.
What is the process?
- Notice period: The landlord serves a section 13 notice with at least two months’ notice of the proposed rent increase (increased from one month).
- Tenant challenge: The tenant must apply to the FTT before the proposed rent start date.
- Acknowledgement: The FTT confirms receipt of the application within seven days and notifies the landlord.
- Hearing scheduling: A hearing is typically listed within 8-16 weeks of the application.
- Evidence submission: Both parties are asked to submit evidence or written submissions in advance.
- Hearing and inspection: Hearings are usually done on paper but can be oral. If a property inspection is needed, this will delay the hearing due to availability.
- Decision: The FTT usually issues its decision within 6-10 weeks after the hearing.
- Effective date: If the rent is upheld, it takes effect from the date in the notice unless this would cause undue hardship. The FTT can defer the increase by up to two months.
- Enforcement: If the increase is upheld, arrears become due immediately. The FTT has no enforcement powers so landlords must pursue civil claims if unpaid.
- Delays: Backlogs at the FTT, and cases where inspections are required, may extend these timelines.
New private rented sector database
Private landlords will need to register with the new private rented sector database which will contain details of all residential landlords and properties and will set out if landlords have been subject to any penalties or convictions.
A property cannot be marketed for rent unless the landlord and property are both entered on the database, and this will include BTR landlords and properties.
What about BTR properties occupied by students?
While the Renters’ Reform Bill includes some exemptions, it notably does not provide any exemption for BTR properties occupied by students.
In contrast, purpose-built student accommodation (PBSA) is set to be removed entirely from the assured tenancy framework. These properties will become common law tenancies, allowing them to retain fixed-term agreements. However, BTR is a distinct housing model from PBSA and is not treated the same under the Bill.
A new possession ground (ground 4A) has been introduced specifically for houses in multiple occupation (HMOs). This allows landlords to regain possession ahead of each academic year, but only if:
- all tenants are full-time students; and
- the property has three or more bedrooms.
This means one- and two-bedroom properties, which make up around a quarter of all student housing, are excluded. Landlords have raised concerns that this could drive them out of the student rental market and are urging the Government to extend ground 4A to smaller properties as well.
BTR schemes, while sometimes housing students, are open to all renters and are therefore not covered by the same exemptions as PBSA or HMOs.
Other impacts on the BTR sector
The Renters’ Reform Bill may open new doors for the BTR sector. The proposed legislation has raised concerns among smaller private landlords around increased regulation and reduced security, and it is anticipated that there may be an exodus of individual landlords from the market.
This will result in a reduction in supply, but demand for high quality rental properties will remain high. This might present the perfect opportunity for BTR developers to step in and deliver purpose-designed rental properties at scale.
As the market evolves, BTR providers are well-placed to attract and retain tenants who prioritise quality, consistency and service.
Conclusion
While the Renters’ Rights Bill is still progressing through Parliament, it is already clear that it will bring about a significant transformation in the private rented sector. Although these changes may pose challenges for some landlords, they also present a timely opportunity for BTR providers to step in, scale up and meet growing demand with professionally managed, high-quality rental homes.
Staying informed and proactive will help ensure compliance, therefore, BTR providers should:
- Keep up-to-date with the progress of the Bill.
- Be proactive and register with the redress scheme and the rented sector database as soon as these are introduced.
- Consider how they intend to deal with pet requests.
- Consider if any section 21 notices on existing tenancies should be served.