Renters’ Rights: What you should be doing right now

0:01Hey everyone, it's Rob B here with Rob D and you are listening to The Property Podcast. On May 1st, 2026, the world of property in the UK is going to change because the Renters' Rights Act will formally begin on that day. What does that mean for you? What do you need to be worried about? What do you need to put in place? All your questions you have and some you probably been not even thought of yet will be answered in this podcast.

0:33Yes, thank you for joining us for the Property Podcast. In case you don't know, we buy more than£100 million worth of property every year for our clients. You can find out about that at propertyhub.net slash invest. And of course, when we're investing, we want that capital growth. We want leverage and inflation working for us, but we also need that income. So any changes to do with tenancies you need to know about and this you really need to know about but don't worry we're going to cut through all the scaremongering give you everything you need to know and everything you need to be doing right now so let's start with our news story of the week and rob we are very lucky because saviles have got their crystal ball dusted off and have revealed to us what the next five years look like for the uk property market yes they have and the bottom line is basically slow for the next couple of years and then picking up so they reckon we'll finish on one percent growth this year, 2 % next year, then getting up into the fours and fives, taking us all the way through to 2030.

1:25And the basic argument seems to be similar to what we've been saying, which is that at some point, value is just going to become so obvious that everyone's going to get excited again. So there's already value there in big parts of the country. We've had a couple of years of prices going nowhere while wages have gone up, rents have gone up, things are already much better than the sentiment would have you believe. Then if we have another year of that, plus mortgage rates falling which they believe is going to happen then you get to a point where it's so compelling that sentiment flips and off we go so that's their view with their big professional research team pouring over all this but rob i don't know what you think do you agree i mean it makes complete sense we've talked about it on the podcast as well that when deals get too good the market just realizes it and starts to move in and then property prices will start to lift like we've been talking recently about the strength of deals in the market it's been absolutely crazy so there's deals to be done right now.

2:17Not everybody is awake to that, but they will eventually. If interest rates continue to fall and yields continue to improve and both look likely to happen, then you will see that strong growth. It's really interesting how conservative their forecasts are for 26 based on that though. I can see why they've gone up 1 % this year because it's nearly the end of the year and they have that data to indicate that it's going to end up around that level. So it's not that brave of a prediction, more on that in a minute, but I would have thought that they may have been a little braver with 26 going past that trying to do a five-year forecast i think it's very brave and it's really hard to get it right for one year which if you go back one year and look what they said a year ago is very much proven because a year ago they said 2025 would be four percent this year so they've adjusted it so now it's near the end of the year they've adjusted their figures to be almost bang on at 1 % of 2025.

3:11But a year ago, their outlook was 4 % for 2025 and 5.5 % for 2026. Now, in the grand scheme of things, not a lot has changed, but their predictions have dramatically changed. And it's not really to bash, it's more just to say that I wouldn't pay too much attention to a five-year forecast when it's proven there that it's exceptionally hard to get a one-year forecast right. Yeah, as we'll discover for ourselves in a few weeks when we go back and look at our predictions from the start of the year yeah i think you're right the tricky bit is timing like the shape of it sounds about right to me but when is this going to happen when are rates going to fall when is sentiment going to flip we just don't know and that's barring any complete unknowns which of course could come up at any time so what's the value of a five-year forecast i don't really know for me what keeps me investing is the fact that just the fundamental drivers that we always talk about such as inflation leverage everything else that's always working in your favor whatever's going on so you know it'll all come good in the long term so with that in mind whether we get two percent next year or four percent next year doesn't really matter all that much two very quick points before we get into the big story in this week's episode first of all next week we have a budget yes we've been talking about it for long enough the budget is happening next week now because of timing we want the podcast to be as fresh as possible so we're going to be recording it very early thursday morning so the podcast will be slightly delayed next week producer dan has stepped up and said he's going to turn it around in the matter of hours so that's incredible so you will get it on thursday but do not panic when it's not in your podcast feed in the early hours it will just be a little bit late next week and second just a big thank you to the wonderful people who joined us for a sand dance dinner last week rob and i had a wonderful evening with some of our generous donors last week in the shard actually of all places wonderful views great evening really enjoyed it and it was just great to be able to host some of the amazing individuals that donated to that incredible cause now that cause if you have no idea what i am talking about right now we'll link to a few bits in the show notes including some progress pictures of the sand dam that the property hub community has supported so that will be in the show notes as well so if you'd like to see how things are getting on because so many of you contributed to that amazing cause then you can have a look there but once again thank you to those individuals and thank you to everybody who made it happen.

5:33So Rob, Rent is Right. We've been talking about it for literally years. Well, you have, yeah. Fair enough, I have. Lots of other people have as well. It's a big deal. It is a big deal. You've been irrationally excited about this one, Rob. This has been a long time coming for you. It has. And like royalty, from this day on, I'll be celebrating two birthdays. I'll be celebrating my actual birthday and the 1st of May. To commemorate Rent is Right's coming into force because yes, we finally know that is when it's going to take effect. The 1st of May, 2026. I've already ordered my bunting but this episode we're going to recap what that means what is going to be happening but most importantly what you can be doing now between now and May to make sure you're ready Rob I know I jest but this is actually really important stuff and it's important because I think a lot of people have got worked up over things that they didn't need to and there's a way to just work with this as a landlord and actually quite a bit of it can be seen as a positive as well.

6:28And no, not everyone's going to agree with that. And some people are already getting a bit antsy over what I've just said, but this doesn't have to be something that ruins your day or next year when this comes in. This is something that you can work with, but let's explain what you are working with. And the first thing, Rob, is tenancy terms are no more. So the six month term, the 12 month term, all that goes away. The agreement will just keep running unless a certain event or trigger takes place, which we will get into. But let's just explain that first because that's going to be something that people really need to understand yeah this is a huge change we're all so used to tenancies being for six months a year whatever it's going to feel really strange to be issuing a tenancy that just goes on for as long as it goes on so as we said this will take effect from the 1st of may next year so if any tenancies you issue from that day onwards they will just run and run and run until the tenant decides to leave or you have a valid reason to end it what's really important to understand as part of this change is that all your current tenancies will flip and transfer to the new type on the 1st of May as well.

7:30So if you've got someone who's on a 12-month tenancy and they're halfway through on the 1st of May next year, then basically that fixed term immediately stops applying and it will become one of these new indefinite tenancies. What that means is you won't be able to use section 21 to end that tenancy. We'll talk about ending a tenancy in a minute, but it also means that your tenants will be able to leave with two months notice. So under these new style indefinite agreements, tenants will be able to leave at any time by giving two months notice including on the day that they move in but when we're thinking about current tenancies even if on the 1st of may someone's got six months left to run at that point boom it converts they will be able to leave with two months notice now that may sound a little intimidating but let's face it the majority of people just want to live their lives they're not thinking about how to game the system yes there is that one percent that exists in both landlords and tenants who both parties aren't great but 99 % of landlords 99 % of tenants just want to go on with their lives rent their property and not have that hassle you're not suddenly going to get people coming into your property renting it and then immediately giving you two months notice that doesn't make sense in the majority of circumstances it may happen to you but it's highly highly unlikely while it sounds like oh that's a not a great thing the chances of that actually happening are very very slim but let's get into how a tenancy can end because there have to be some conditions for a tenancy to end and of course one of them the main one is the tenant not paying so once they're in rent arrears so rob the changes here as well section 21 has disappeared the old method of moving somebody out so what needs to happen now to be able to move a tenant on if they've stopped paying.

9:15So the trigger is them owing you three months rent. Once they owe three months rent, you can then give four weeks notice that you'll be applying for a possession order. So this is very similar to the route that we've got now that you can use in a fixed term. So for background, without getting into too much detail, at the moment you can use section 21, no fault, to end a tenancy at the end. In practice, lots of people use this when there is fault because it's just quicker. You don't have to prove anything, you just get it done. Actually, it's not that quick because the courts are backed up more on that later but if you want to remove someone for rent arrears during a fixed term at the moment you use something called section 8 that's going to stay but the thresholds are changing a bit so basically they owe you three months rent you start court proceedings and as long as they still owe at least three months rent on the date of the eventual hearing then the judge has to grant petition and tell the tenant to leave so rent arrears is one of the main things that investors are obviously worried about the other thing that can happen which is a little bit more tricky is anti-social behavior or just general breaches of the tenancy agreement so what makes this tricky is the only way that you're basically guaranteed to be able to get possession basically the tenant is in trouble with the police we don't have to get into the specifics but it's a high bar it's pretty serious for anything less than that they can be pretty blooming annoying but if it doesn't reach that bar then it's always up to the discretion of the court about whether they ask them to leave or not so that's probably actually a trickier situation than rent arrears because with that you know that there's a mechanism with general antisocial behaviour or breaching the agreement that's going to be much harder.

10:42Another way you can take back possession of your property is if you want to sell it. Luckily that common sense has prevailed and you are able to take your property back if you do want to sell. You need to give the tenant four months notice but I think that's about a reasonable amount of time if you're moving somebody out of their home and you can't do this within the first 12 months of a tenancy either. So you have to be pretty clear that you have no intention to sell the property within that first year. You can get your property back on paper at least fairly easily if you go down that method and you do very much intend to sell it.

11:15Another interesting piece of this legislation that seems to attract quite a bit of attention is rent increases. Now once this comes in in May you'll only be able to increase your rent once a year with two months notice. and tenants will be able to challenge that at a tribunal if they think it's higher than open market rent. Now personally I'm not too worried about this because I don't think I've ever in all the years I've been in property increased rent more than once in a year and I've always gone in at market level or maybe even a little bit less if it's an existing tenant. So I do not think for majority of landlords this will be an issue i think some people might be scared of the unknown because no one's actually gone through this and been challenged at a tribunal yet but as long as common sense prevails and hopefully common sense does prevail i think this will be absolutely fine for the vast majority of landlords while this isn't in the detail i can only assume that this is to prevent you pricing out somebody as a mechanism to move them out so you double the rent to try and kick them out so you don't want to sell the property but you want to get a new tenant in for whatever reason.

12:26This is a way to prevent you using the rent increase as a tool. But for sensible increases during the tendency, I think it should work as intended. Yeah, you're right. That is exactly the reason that they're doing it. Now, some people are getting very hit up about this because if the tenants challenge it and take it to tribunal, then the rent increase won't take effect until the tribunal has made their decision and it won't be backdated. So if the tribunal is backed up and it takes months to actually make a decision, even if they agree with you, then the rent increase won't take effect until later.

12:58So the rational thing to do is for every tenant to always challenge every rent increase in every situation. So that's what some people are getting very worked up about. And I see why, because it doesn't really seem fair. But in practice, I think it's like what you said, Rob. Most people aren't out there to play the system. Most people are perfectly reasonable. And awareness of everything around tenancy law is extremely low. So most people won't even be aware that that's something that they can do and won't even think of it. So I can see why people are bothered about it, because it seems like a really silly loophole.

13:28But like you say, in practice, I don't think it's going to make a big difference. Now, something that actually could make a difference in some situations when it's pretty annoying is that you won't be able to take more than a month's rent in advance. So this is another of those things where they're trying to stop you basically advantaging anyone over anyone else. It's all a bit silly. And in situations where you're renting to international students, for example, it's really common to take the full 12 months up front because they've got no UK credit history and it's actually easier for them to transfer the money in one go from abroad.

13:58You won't be able to do that anymore. I assume that escrow schemes and things like that will start to pop up because it just makes sense. You need to have a solution for situations where there is no credit history and you've got people moving from abroad. But nevertheless, that is something else that's going to come into effect from May. You also won't be able to accept rents higher than the amount that you advertise the property for. So this is meant to be doing away with bidding wars. So I imagine in May, we will suddenly see rents adjust upwards in a big jump because you know that you can then accept anything up to that amount.

14:28Again, you see what they're trying to do, but it seems a bit silly to me. And then there's loads of other little bits and bobs, but the other main thing that's caught people's attention is pets. So now you're going to have to have a valid reason to refuse if someone requests the ability to keep a pet, which again, people get very annoyed about by thinking of practice. so many people just get pets anyway and there's not really a great deal you could do about it and of course if someone's moving in in the first place and they already have pets there's nothing to say that you have to choose them over another applicant who doesn't so there are other changes in this new law coming in future years we'll talk about that a little bit later on but that pretty much rounds off the big changes that we now know are coming in may so now we know what's happening and when it's happening we've got some time to prepare i mean the big question rob is what should we be doing now?

15:12The good news is if you're happy for your tenants now you don't need to do much at all. You'll need to serve them with an information sheet which should be published in January. If you have a letting agent I'm sure they will do that for you but awareness around this is important because it is new for letting agents as well and some are very on top of things and some aren't. So you hopefully have a letting agent that is doing a great job. If you self-manage this is something that you'll need to do. If you have tenants in a fixed term now that ends before May, you can renew for another fixed term or not.

15:46It's up to you. But remember from May, that'll stop applying anyway. Important point here, if you have a letting agent that is getting you to sign up to a new term at the moment, they often charge you for that. So I would go on rolling because it's effectively going to be rolling from May anyway and avoid that charge. So it's not going to be applicable to everyone but just something to be aware of so yeah this is just going to happen one day so you don't have to issue a new agreement or anything like that just that information sheet so if you're happy with everything it's all going great don't want to make any changes nice and easy very little for you to be thinking about but what if you do want to make some changes well one thing you might want to do is increase the rent so if you do have a tendency that's currently rolling or you do what rob just said and allow it to continue on a rolling basis when the fixed term ends before May, then that means you can increase the rent and it'd probably be a pretty good time to review it because, of course, from May there is that ability to challenge it by taking it to tribunal.

16:46As we said, I don't think this is something that the vast majority of tenants are going to start doing. So you can do that and either sign them up for another fixed term at that new rent, even though the fixed term will stop applying very soon, or just do it by mutual agreement. That's a new level of rent. Away you go. But the big question, the thing that people are going to have on their minds, I think, is, well, what if you've got a tenancy that's not going well? What if you're in a situation where you've got a tenant who is already in arrears, or they've been inconsistent? They might not be in arrears now, but they're always paying late, always trying to make it up.

17:15Or what if there are other problems? They're just not taking care of the property well. Well, this is where a lot of people will be making the decision about whether to use Section 21 now while you still can. So you can still use Section 21 to end a tenancy up until the end of April. So when that 1st of May date hits, it means that you won't be able to use it anymore, but it doesn't invalidate anything that's already in process. So I think, Rob, this is probably the big thing to be thinking about. Yes, you need to be aware that you need to serve this information sheet to let tenants know what's happening.

17:45But if you're happy with how everything's going, not a whole lot to do. It is just a situation where if you've got a tenant you're not sure about, you're going to have to be thinking carefully about what to do about that, because from May onwards, the options are going to be more limited. And it seems highly likely that the courts are going to be more backed up when this first comes in as everyone gets used to it so you do have this window now up until may to make your decision with your letting agent if you've got one about what you're going to do if you've got that kind of situation and a big point that you said rob is all you need to do is serve it before that may date because they won't be invalidated so as long as you've started the process of section 21 you can still get that which then may create a backlog in the courts anyway because we might get a mini surge of section 21 notices we'll see but that could potentially play out as well so then what are we done not quite because a landlord database will start in late 2026 and this will mean yes you'll have to pay and register the details of your property and all the safety certificates and then by 2028 they're going to bring in a landlord ombudsman which means yes once again you'll need to pay and this will be a service tenants can go to to complain about you and then eventually the decent home standard will be brought in and if you've not heard anything about that yet don't worry we've got until 2035 to sort that out because that is the earliest that will come in and rob that gives us nine years worth of content to go out as well so that's great because i was a bit worried after this episode what we're going to talk about but in all seriousness If you are listening to this and feeling a bit overwhelmed by it all, you don't need to.

19:25As we've said, it will take a little bit of bedding in once it starts, but things should just carry on. And in the majority of cases, you won't even notice this is in play because the majority of the time you have a property that's being let out by your tenants and there shouldn't be that much engagement. If things are going well, if you vetted them properly, you've got good insurance in place, then this doesn't need to be a big deal. It's amazing, though, how low awareness is around this. I actually missed the announcement. It was only Rob telling me it'd come in. Now, if it was released as part of the Epstein files, I'm sure we all would have heard about it, but the fact that it wasn't in there and there was other news going on means that this just isn't getting any coverage.

20:09So I think there's a piece of work to be done by the government around that. And I think a lot of people will get caught out because they aren't ready. Those information sheets, you're self-managing, you don't listen to the property podcast. It's not covered in the news. I can see a lot of people missing that. Letting agents now need to get on top of things and guide people through this process as well. So don't assume that they're already on top of it, just to check in with them and get their assessment and their plans of what they're going to be doing. But once this is bedded in, Rob, I think this is something we'll actually not even talk about in a couple of years' time.

20:40there'll be occasions when it becomes a gripe but actually this is something that professionalizes the rental market where people can feel like they have a home and trust the rental market that's the primary driver here it's not to screw landlords over it's to create an environment that people feel comfortable renting in as a long-term solution and the more people that see rent as a long-term solution a viable option i think that's a good thing yeah there are certainly things that I would change about how this has been implemented. There are things in there that frankly seem a bit silly. And as the years go on and the database comes in and the ombudsman comes in, then yeah, it is just more admin and it's going to be a bit heavier.

21:20But change was needed. I think that's something that gets forgotten in this whole debate. The system right now really doesn't work very well. And as more and more people are renting, you need renting to, as you've said, be more attractive as a long-term option. And like you've said, it will just become part of life. Every time something gets brought in, there's all kinds of a fuss about it. We had it years back with deposit protection. We had it with the tenant fees ban. And now it's just normal. This is a big change, definitely not minimising it. But at some point, it will just become normal.

21:49And it's easy to get yourself worked up into a tizzy about the potential for all these things to go horribly wrong and for people to play the system and all this. But a minority of people, a tiny minority of people play the system now. So you've got to take a professional approach. You've got to be doing all the right things, whether you think they're silly or not, there's not the option anymore of being casual about it. And you've got to get your tenant selection right. You've got to reference properly and you've got to be on the lookout for red flags because personally, every time I've had some kind of issue, I could have seen it coming if I'd just been more alert at the start.

22:20Yes, you can get unlucky, but you can really minimise that by being diligent at the start. And I think, as you said earlier, Rob, keep yourself educated. Don't assume that your letting agent is going to be all over this because they might not be. And you do have this window to prepare. So you've got until next May. If you do have any situations that you're not sure about, now is the time to do something about it. But we'll leave you with a stat, a stat that hopefully will give you some comfort. And that stat is that 92 % of tenancies currently are ended by the tenant. So it's their choice to end the tenancy.

22:5292%. So that means in 92 % of circumstances, it should be fairly straightforward. And in the other rate, it doesn't mean that it's all a nightmare. It's just a process that you need to go through because you might be selling the property. Yes, they might be in arrears, but the point is nine out of 10 of your tenancies statistically should be okay, should be perfectly fine. And of course, there are things you can do, the type of property you pick, the tenant you pick, the insurance you have in place, all these things will matter. But if you take these steps, this will just be something that's implemented, you deal with, and in the long term, you'll be absolutely used to it operating and you'll be absolutely fine as an investor.

23:32Okay, so that is Renters' Rights. And if you want more on this, then do check out our YouTube channel because we've got a video recapping all of this and what you should be thinking about to prepare right now. So go over to YouTube, search Property Hub UK and find that. But we've also got something extra for you. We've got Hub Extra. And Rob, this one is something I'd never heard of before, but you've put down Booksy. Yes, I have an app to make your life a little bit easier this week and it's called booksy and booksy is a tool that allows you to book many things but how i've been using it is to book haircuts so you look on the app you can say what area you're in look at the reviews of those barbers and select your time so that means no waiting around once you get to that barbers like if you just turn up and you have to wait for somebody to be free it also allows you to select your favorite barber so that lottery of oh no i hope it's not that guy and when they're cutting your hair and yes i appreciate this update is very gentleman focused at the moment but the hairdressers also exist on their nail technicians or beauticians can't say i've taken up any of those services yet but they all exist as well so a potential app for everyone where i can see this particularly being useful if you are traveling in a town or city and you want a service like this then you can then you can use the app which is convenient but also i think it's great that you can look at the reviews of each establishment as well so you don't go in feeling nervous about the service that you're going to get so cool little app worth a download and check it out and if you're very happy with whoever cuts your hair or does your nails at the moment but you are traveling then maybe that's a useful app that you can take advantage of well there you go we've got you feeling informed and looking sharp don't say we don't take care of you on this podcast that is us done for this week though thank you for listening do remember to check out our youtube channel for more on this topic you'll find us by just searching property hub and we will be back next week as we said with our budget special oh it's my birthday today it's christmas next week it just keeps coming but we have all the budget news for you next thursday and it will be a little bit later in the day because we're recording it first thing so make sure you check in on thursday and we'll give you everything you need to know until then have a great week bye-bye bye-bye