The Renters' Rights Act for Overseas Landlords: Selling Now Takes 16 Months, and the Sell-Off Already Peaked

The Act received Royal Assent on 27 October 2025. Council enforcement powers came in on 27 December. The tenancy reforms, which the Ministry of Housing calls Phase 1, all commenced on 1 May 2026 and apply to tenancies that already existed as well as new ones. There was no transition period for existing fixed terms. A two-year fixed tenancy signed in March 2026 became a periodic tenancy on 1 May, and the tenant can now leave on two months' notice at any point.

Possession without a reason no longer exists. The grounds that matter to an overseas owner are Ground 1A (selling) and Ground 1 (moving in yourself or a close family member). Both need four months' notice. Neither can be used in the first 12 months of a tenancy, though notice can be served earlier as long as the date in it falls after month 12. After using either ground, the landlord cannot market or re-let the property for 12 months, and doing so is an offence with a civil penalty of up to £40,000. The mandatory arrears ground, Ground 8, now needs three months of arrears rather than two, on four weeks' notice rather than two. Universal Credit housing-cost arrears are disregarded when counting.

A landlord may now raise the rent once in any 12 months, by serving a Section 13 notice at least two months ahead. Any rent review clause written into the contract, including an index-linked one, is void. The tenant can refer the notice to the First-tier Tribunal, and the tribunal will set the lower of the open-market rent and the figure the landlord proposed. It cannot set a higher figure. The new rent takes effect from the date of the tribunal's decision, not the date in the notice, and the tribunal can defer it by up to two months in cases of hardship. Trowers & Hamlins, the law firm, has described this as the change most likely to reshape landlord behaviour, because the only cost to a tenant of challenging every increase is the delay it buys.

Rent in advance is capped at one month once the agreement is signed. Landlords and agents must publish an asking rent and cannot ask for, encourage or accept offers above it. Refusing applicants because they have children or receive benefits is illegal. A written request to keep a pet must be answered within 28 days, refusal must be reasonable and given in writing, and the government's own guidance lists disliking pets, damage by a previous tenant's animal, and worries about re-letting as unreasonable grounds. The final Act dropped the pet-insurance requirement that appeared in the Bill, and a separate pet deposit remains a banned fee under the Tenant Fees Act 2019.

Civil penalties start at £7,000 for a first breach and rise to £40,000, or criminal prosecution, for repeat or serious ones. Rent repayment orders now run to 24 months rather than 12, and reach superior landlords, which closes the route of holding the property through an intermediate company lease.

Savills, looking at the 12 months to March 2026, found 254,000 ex-rental homes listed for sale, up 9% on the year and 28% on two years earlier. Lucian Cook, its head of residential research, said the Act had become a clear point at which landlords reassess their investment. Hamptons, looking at June 2026, found ex-rentals had fallen to 9.2% of all sale listings from 11.3% a year earlier, and that in the first four months of the year landlords made up 13.3% of buyers across Great Britain, the highest share since early 2016. A record 23% of those landlord purchases had previously been let. In the North of England landlords were 23.9% of buyers, against 9.1% across the South, at a gross yield on previously-let homes of 6.7%.

The selling ran hardest into the commencement date and then slowed, and a large share of what was sold went to other landlords, disproportionately in the North. Hamptons also found that 51% of landlord-listed homes in the prior year had failed to sell, rising to 60% for flats, and that flats took 85 days to go under offer against 59 for houses. The stock that left the rental market was the stock nobody wanted at the asking price.

The incorporation data points the same way. Hamptons counted 41,483 new buy-to-let companies between January and August 2026, 8% fewer than the same months of 2025, with August alone down 22%. If that holds, 2026 will be the first year of falling incorporations since 2008.

The Bank of England held Bank Rate at 3.75% on 16 September 2026, by six votes to three, with the three dissenters wanting 4%. CPI was 3.1% in August and the committee said it was likely to rise further, adding that policy might have to tighten if the energy shock from the Middle East fed into wages. The next decision is on 5 November. For a non-resident borrower the retail rate is set by specialist lenders. Skipton International's five-year fixed expat buy-to-let is 5.59% up to 75% loan-to-value, or 5.19% on loans of £400,000 or more, with a £1,999 arrangement fee and a £150,000 minimum loan, fixed to 30 September 2031. Lenders typically discount foreign-currency income by 10% to 20% when assessing affordability.

The purchase tax stack has not moved since 1 April 2025. The higher rates for additional dwellings in England and Northern Ireland carry a 5% surcharge, raised from 3% on 31 October 2024, giving bands of 5% to £125,000, 7% to £250,000, 10% to £925,000, 15% to £1.5 million and 17% above. A buyer who has spent fewer than 183 days in the UK in the 12 months before completion pays a further 2 percentage points on every band. On a £600,000 London flat that is £62,000 of stamp duty for a non-resident investor against £20,000 for a UK resident buying a main home. Income from the letting is then taxed under the Non-resident Landlord Scheme, under which the agent withholds 20% at source unless HMRC has approved gross payment on form NRL1i, and it withdraws that approval if returns are late.

Rents rising 3.8% while London prices fall 3.3% is the combination that makes the arithmetic work for a holder and not for a seller. Gross yields in London improve when the denominator falls, and the tenant who cannot be evicted without a ground is also the tenant who cannot be replaced at a higher rent by a bidding war.

The Private Rented Sector Database, branded Register your rental property, opens on 15 December 2026 in the West Midlands with a deadline of 14 March 2027, then adds a region a month: East of England in January, East Midlands in February, South East in March, Yorkshire in April, North West in May, North East in June, London on 15 July 2027 with a deadline of 14 October, and the South West in August with a final deadline of 14 November 2027. Any landlord may register from December. The National Residential Landlords Association reports the fee as £65 per property per year and the requirement that landlords register themselves, which for an owner in Singapore or Dubai means a personal government login. The required data includes the address, bedrooms, rent, licensing, gas and electrical certificates and the EPC.

Behind the database sit the parts of the Act with no date. The government expects mandatory membership of a landlord ombudsman in 2028. The Decent Homes Standard is proposed to apply to private rentals from either 2035 or 2037. The government will extend Awaab's Law, which imposes repair deadlines for damp and mould, to the private sector on a timetable it has yet to consult on. It has consulted on a minimum EPC of C by 2030 and has not responded.

The English Housing Survey counts 4.7 million private renting households, 19% of the total. In the year before the Act, 14% of tenancies that ended did so by eviction, and 45% of those tenants were served a Section 21. Renter satisfaction was 66%, down from 70% five years earlier. The first measure of whether the Act has moved those numbers will be the 2026-27 survey, due on the current publication cadence in mid-2028.