Editor's note: This brief was summarised by The Property AI Newsroom from a report by The Negotiator. Read the original article for full details.

Renters Face Unintended Impacts from Renters’ Rights Act, Reports Suggest

The Renters’ Rights Act, which became law on 1st May, was described by ministers as “the biggest shake-up to renters’ rights in a generation.” However, three months after its introduction, reports indicate that renters are experiencing negative consequences, including rising rents and restricted access to housing.

Industry commentators had previously warned of potential issues such as price hikes and reduced supply before the Act took effect. Early data from Goodlord’s Rental Index shows annual rent inflation at 1.7% in April and May, rising sharply to 6.5% in June—the highest increase in nearly two years. This figure is more than double May’s CPI and exceeds wage growth, suggesting that the intended financial benefits for renters have not yet materialised.

The Act’s cap on advance rent payments, designed to protect vulnerable tenants, is reportedly excluding groups without UK guarantors or credit histories. International students, who previously could pay rent upfront, may now face difficulties accessing the rental market.

Some operators are reportedly testing the boundaries of the new legislation. According to Inside Housing, tenancy restructures are being used to reset rents, potentially undermining the Act’s aim to limit rent increases. If these practices continue, they could further disadvantage tenants.

The anticipated mass “landlord exodus” has not yet occurred, but landlords are facing uncertainty. The reletting ban tied to Ground 1A means landlords who attempt to sell and fail face a 12-month ban on re-letting. Hamptons estimates that, if this rule had applied last year, between 80,000 and 100,000 unsold rental homes would have been unable to be sold or re-let. In some regions, landlords are reportedly holding onto properties, particularly flats, where the market is slow.

Goodlord data from April indicated that half of landlords wanted to sell or reduce their market stake within twelve months. Nearly half of tenants remain unaware or unsure about the shift from fixed-term to rolling contracts, and a third have experienced rent increase attempts since 1st May. Estimates suggest the legislation has cost landlords £5,000 so far, with these costs likely to be passed on to renters.

The political context is also shifting, with Andy Burnham’s arrival in Downing Street and a record of increased enforcement and rent regulation in Greater Manchester.