Renters’ Rights Act 2025 and its impact on the PBSA and BTR sectors

Renters’ Rights Act 2025

By the Renters’ Rights Act 2025 (RRA), the government is seeking to transform private renting. The RRA received Royal Assent on 27 October 2025 and will be (using the government’s own words) “switched on” on 1 May 2026.

The full provisions of the RRA will be introduced over time to provide sufficient time for landlords and agents to prepare effectively, for necessary regulations to be made and for consultations to take place. Many provisions will however be in force immediately from 1 May, including of principal note:

1. How and when residential tenancies can be terminated. Section 21 notices will be abolished, and new grounds and extended notice periods will be introduced.
2. The abolition of fixed term tenancies. All tenancies will have no fixed expiry and continue until terminated in accordance with one of the grounds provided by the RRA.
3. There will be strict controls on how and when rent can be increased.

Many sectors in the built environment are concerned with shorter-term residential tenancies, therefore will be significantly impacted by the RRA. We focus on two of those sectors below.

Purpose-built student accommodation and student accommodation

The government plans that purpose-built student accommodation (PSBA) providers signed up to Accreditation Network UK (ANUK) or the Unipol Code, or considered specified institutions, will not be caught by the RRA’s provisions and will be able to continue to grant fixed term tenancies after the RRA comes into force. We await the final regulations to make this happen.

The tenancies granted by those providers, like tenancies granted by universities will then continue to operate based on their express terms, as common law tenancies. This is important as it puts the sector on a more level playing field.

There may be an interim period when PBSA providers’ termination rights are limited. Prior to the RRA becoming law in May, PBSA providers may terminate existing tenancies using Section 21 notices. If the regulations about PBSA providers come into force before May, there will be no gap, but if they do not, PBSA providers will be unable to terminate, except using the expanded list of grounds in the Housing Act 1988, such as rent arrears or other breaches. For accommodation that is also a house in multiple occupation (HMO), where they have served notice before 28 May 2026, they will be able to rely upon the new ground 4A. This new ground is designed to keep student accommodation available to students each year.

The effect of the RRA will differ for other landlords of residential properties let to students, dependent upon whether they are:

1. PBSA providers not signed up to ANUK, the Unipol Code or considered a specified institution.
2. Landlords of non-HMOs.
3. Landlords of HMOs.

The academic year from 2025 to 2026 will therefore be an interesting time for the sector.

Build to Rent

As those in the Build to Rent (BTR) sector will already be aware, the RRA introduces widescale changes to private residential tenancies and enhanced protections and rights for tenants. Of notable importance to BTR investors, developers and advisors will be those provisions relating to:

• The removal of fixed term tenancies from May 2026. All tenancies will become assured periodic tenancies, which can only be terminated in specified circumstances, including on receipt of two months’ notice from the tenant. This may lead to longer-term tenancies but removes the certainty of how and when tenancies will end. And affords more flexibility to tenants.
• The abolition of Section 21 notices again from May 2026 and extension of default and notice periods for landlords to seek to recover possession.
• Rent increases can only occur once per year and only upon two months’ prior written notice to the tenant(s). Tenants can challenge the increase in the First Tier Tribunal if they feel the rent is too high. Increases will not be backdated even if the tribunal decides in landlords’ favour.
• Already rent cannot be demanded or accepted in advance of the commencement of the tenancy, or for more than one month once the tenancy commences. The rent deposit limits in the Tenant Fees Act 2019 continue to apply.
• The RRA provides for regulations to be introduced (expected to be later in 2026), obligating landlords to register themselves and their properties on a private rented sector database. Landlords will also need to join a new ombudsman scheme for the swifter resolution of disputes with tenants.
• The RRA allows for regulations to be introduced requiring homes to comply with the Decent Homes Standard and will provide councils with enforcement powers. This is likely to happen in late 2026/early 2027.

Practical considerations

Some practical points to consider prior to the RRA becoming law:

• If a student landlord, early assessment of which regime applies to you and how the changes may impact your operations.
• Assess the state of repair and condition of properties and whether they will meet the Decent Homes Standard and plan maintenance if necessary.
• Review and ensure documentation, notice procedures, and systems are aligned with the RRA. Regulations will provide notice forms in due course.
• Given the changing rent arrears and notice periods, considering rent guarantee insurance to secure income and coverage in the event of defaults. Consider (where appropriate) requiring personal guarantors of tenant obligations to enhance security.
• Where possible and appropriate, such as in shared or serviced accommodation, using licences instead of tenancies, as the RRA applies to tenancies only.

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