The future of renting in the UK — what landlords should watch for in 2026
The UK rental market is quietly shifting from short-term survival mode (interest-rate shock, affordability squeeze) to a more regulated, greener and tech-enabled era. If you’re a landlord getting ready for 2026, this isn’t about panic — it’s about preparation. Below I explain the five big trends that will matter next year, why they matter, and practical steps you can take now.
1) Legal change: the end of Section 21 and the Renters’ Rights Act
Big picture: major tenancy law reform has landed. The Renters’ Rights Act (which received Royal Assent in 2025) removes “no-fault” Section 21 evictions and replaces them with a strengthened, clearer set of grounds for possession. Implementation starts in 2026, and landlords will need to rely on specified possession grounds (Section 8 style) rather than issuing Section 21 notices.
Why it matters: landlords will have to keep much tighter records, follow new notice procedures, and be familiar with the grounds that justify possession. The practical effect is greater security for tenants — and a need for landlords to be more process-driven, or to rely on professional lettings/legal support.
What to do:
Familiarise yourself with the Renters’ Rights Act guidance and the possession grounds. Start updating your form letters, notice templates and record-keeping. Tighten documentation: inventories, property condition photos/dates, repair orders, written communications about breaches. These will matter if possession is contested.
If you use a letting agent, confirm they’re trained on the new rules; if you manage yourself, consider a solicitor or specialist training for 2026.
2) Energy efficiency and “green” compliance will move from optional to essential
Big picture: policy and market pressure keep pushing energy performance higher. Government consultations and regulatory moves in 2025–2026 aim to raise minimum standards for privately rented homes over the rest of the decade (movement toward higher EPC targets and new minimum standards by 2030 are actively being discussed). Even before absolute deadlines, tenants and insurers increasingly expect warmer, cheaper-to-run homes. Why it matters: poor-EPC properties are becoming harder to let, more expensive to insure or finance, and — in some areas — could face higher licensing scrutiny or fines. Upgrades also reduce void risk and attract longer-term tenants.
What to do:
Audit your portfolio’s EPC ratings now. Prioritise the lowest-performing properties (E/F/G) for early works.
Start with low-cost, high-impact measures: loft insulation, draught-proofing, smart thermostats, efficient boilers or heat-pump-ready installs where feasible. Document all works and receipts.
When budgeting, assume regulators will tighten over the next 3–5 years — treat energy improvements as capital investments that can speed lets and reduce voids.
3) Market dynamics: rents steadying, modest growth, and location-led winners
Big picture: recent data shows rental growth slowing from the peaks of post-pandemic volatility, with forecasts pointing to modest rent rises across 2026 (different sources project low single-digit increases). Demand will remain strongest in affordable and commuter-friendly markets, and purpose-built Build-to-Rent (BTR) continues to expand as institutional investors target long-term rental income.
Why it matters: landlords should expect a more predictable rental market — not runaway growth — meaning tenant retention and property quality will be key competitive advantages. BTR supply growth in large towns/cities can push standards up, especially for professional tenants used to amenities and service levels.
What to do:
Focus on tenant retention: small upgrades, flexible lease terms, fast repairs and clear communication reduce turnover and voids.
Keep an eye on local supply: in towns seeing lots of BTR or new development, compete on service and niche offerings (e.g., furnished lets, family-friendly features).
Review rent reviews sensibly — pricing slightly under comparable listings often reduces void length and total income disruption.
4) Finance & lending: improving but still watchful
Big picture: mortgage markets improved through 2025 with modest easing of rates and lenders loosening some affordability criteria. Forecasts for 2026 expect modest growth in lending and a gradual return to more predictable cost structures — but BTL (buy-to-let) lending still requires careful cashflow planning and stress-testing.
Why it matters: refinancing or portfolio expansion is more feasible than in the high-rate period of previous years, but lenders still expect strong compliance (EPCs, licensing, clear tenancy records) and robust service of properties.
What to do:
If you’re refinancing, get quotes early and present up-to-date compliance documentation (EPCs, licences, safety certificates).
Stress-test your portfolio for a range of rate scenarios and build buffers.
Consider fixed-rate products to lock in predictable costs where it suits your financial plan.
5) Tech, tenancy services and short-term lets regulation
Big picture: landlords face two simultaneous tech-driven trends — better property management tools (digital rent collection, repairs apps, AI chatbots, tenant portals) and tighter local regulation for short-term lets in hotspots (London’s 90-day rule remains an example). Technology can cut administrative friction but won’t remove legal/permission risks for holiday lets. Why it matters: tenants increasingly expect digital onboarding, instant repair reporting, and flexible rent-payment options. Meanwhile, using a property for short lets without the correct permissions can attract fines and damage long-term income prospects.
What to do:
Adopt a simple tenant portal or a reputable agent platform for contracts, maintenance and rent collection. These reduce disputes and make compliance audits quicker.
If you use or plan to use short-term letting, check local planning and licensing rules (e.g., London’s 90-night limit) and be transparent with insurers and mortgage providers.
Quick checklist for landlords preparing for 2026
Read the Renters’ Rights Act guidance and update notice templates — start May 2026 compliance planning now.
Audit EPCs; plan a 3-year energy-improvement programme (insulation, heating upgrades, smart controls).
Improve records: inventories, photos, repair logs, tenant communications. These matter more when you must rely on possession grounds.
Consider small, tenant-facing upgrades (fast Wi-Fi, flexible rent payment options, quick-response repairs) to reduce churn.
Review finance: get lender readiness checks, consider fixed rates, and keep contingency funds.
Check local short-let rules before listing on platforms and declare appropriately to insurers/mortgagees.
Final thought
2026 looks less like a cliff and more like a steady climb: clearer rules, stronger tenant protections, and tougher environmental expectations — but also a calmer rental market and improving finance conditions. Landlords who get compliant, document everything, and invest selectively in energy and tenant experience will benefit from lower voids and steadier returns.