The Renters’ Rights Act (RRA) 2025 aims to better protect tenants while introducing important shifts and increased regulatory requirements for the Private Rented Sector (PRS).
Likely winners will include landlords and agents who are able to embrace compliance, improve energy efficiency, and navigate the updated regulatory landscape effectively.
Those most at risk of losing out are non-compliant landlords and tenant groups for whom renting may become increasingly unaffordable under the Renters’ Rights Act.
Key trends for landlord and agents: increased reliance on qualified agents, a growing trend of consolidation across the sector, larger landlords and agents buy out smaller ones and agencies and additional expertise required due to increased anti-money-laundering (AML) enforcement.
Overall, the PRS is evolving into a more professional, compliant, and standards-driven sector, with higher operational expectations but greater transparency and security for both landlords and tenants.
The Renters’ Rights Act (RRA) is designed to rebalance the power dynamics in the Private Rented Sector (PRS), giving tenants stronger legal protections and improving living standards. However, while the legislation rightly seeks to enhance tenant rights, it also introduces significant compliance and financial pressures that could reshape the lettings landscape in England.
Compliant landlords who can meet higher standards. The Renters’ Rights Act 2025 requires landlords to change how they let homes at every stage of the process. Those who are full-time landlords, or who have the time and commitment to understand and apply the new rules and regulations, will be best placed to ensure their property is let legally and safely, with no damp or mould. They will be able to analyse the market to determine – and, where necessary, justify – a fair rent, select tenants without discrimination, and understand the shift from Section 21 to Section 8 when seeking possession. Landlords who can also invest where needed so their property meets higher standards, including Awaab’s Law and the Decent Homes Standard, as well as achieving an EPC C rating by 2030, should be able to remain in the market and are likely to benefit from a larger pool of tenants and stronger rental growth.
Qualified letting agents with in-house compliance expertise. Currently letting agents aren’t required to be regulated and, as a result, many do not fully understand the existing 400+ rules and regulations, let alone the changes and practical implications introduced by the Renters’ Rights Act. Some agents recognise they are not compliance specialists and therefore rely on third-party support. From Chestertons’ perspective, having an in-house team of compliance experts who oversee and ensure that all lettings processes meet the new requirements provides the greatest confidence for landlords and tenants, ensuring consistent, ongoing compliance. Those agents able to demonstrate this level of expertise are likely to attract more landlords, whether they are currently self-managing or switching from another agent.
Tenants who have a reliable income and are able to pass the affordability assessments required to secure a tenancy, as well as any rent guarantee insurance checks, are likely to benefit most from the changes. They should see improved housing standards, including better maintained homes that are free from hazards such as damp and mould, alongside stronger legal protections. These include enhanced security of tenure and clearer notice periods, such as being given at least four months’ notice when required to leave a property. Overall, this group is likely to benefit from the greater certainty the Renters Rights Act will bring.
Landlords unwilling or unable to meet new compliance demands, Landlords who are either unable or unwilling to adapt to the new compliance demands, including concerns around ending tenancies without the use of Section 21, are more likely to be negatively affected. Some are already choosing to exit the private rented sector altogether, opting to sell their properties rather than operate under the more stringent rules introduced by the Renters’ Rights Act. This is particularly the case for landlords with older housing stock, where keeping damp and mould under control may require significant investment, or where achieving an EPC rating of ‘C’ does not feel cost-effective or achievable. For these landlords, the combined financial and regulatory pressures can mean they have little option but to sell up and leave the rental market.
Tenants on benefits and those who may have savings but a lower or irregular income are also likely to be disadvantaged, as they can struggle to pass standard affordability checks. In higher-cost areas such as London, where housing affordability can be stretched, those reliant on benefits are expected to find it increasingly difficult to meet affordability requirements. These often require a combined annual household income of around three times the monthly rent. As rents are forecast to rise faster than benefits, the number of properties available to this group is likely to continue to reduce.
At the other end of the scale, tenants without a regular income, or those with a high but inconsistent income who have traditionally relied on paying six months’ rent or more upfront to secure a home, may also face challenges. Under the Renters’ Rights Act, tenants will no longer be able to secure a property by paying more than one month’s rent in advance, removing an option that previously helped some renters access the market despite failing standard affordability checks.
Tenants with previous evictions or arrears, Under the new eviction rules, landlords or their agents will be required to clearly state the reason for asking a tenant to leave. As most new tenancies require references from previous landlords, any issues during a prior tenancy are more likely to be disclosed. For example, if a tenant left a property due to rent arrears, this is likely to be uncovered during the referencing process. In addition, under the new Act, if a tenant falls into rent arrears, the landlord cannot take action for the first three months. As a result, tenants evicted for specific reasons may find it more difficult to secure another property.
1. Landlords Reassessing their Portfolios
In areas such as London, some landlords are reviewing their portfolios due to factors including the RRA, shifts in risk, taxation, and financing (e.g., mortgage rates and Stamp Duty). Others are approaching retirement or exploring options to optimise their investments.
Despite these pressures, property remains one of the UK’s most resilient long-term assets. For landlords continuing in the sector, the RRA provides clearer legal expectations for both landlords and tenants, helping reduce disputes, streamline management, and create a more transparent and professional rental market.
2. Tenant Demand Remains Strong
Despite regulatory upheaval, rental demand continues to exceed supply for most properties. As of November 2025, Propertymark reported an average of six applicants per available rental property, indicating strong competition and sustained demand in the market*. In this climate, rents are likely to stay elevated, and well-managed properties will remain attractive to renters and investors alike.
* Source: www.propertymark.co.uk/resource/housing-insight-report-november-2025.html?utm_
3. Shift to Professional Property Management
Many landlords are increasingly choosing professional support from expert agents as the regulatory environment becomes more complex. A recent industry survey found that 57% of landlords currently use a letting agent to manage some or all of their properties, showing that a substantial portion of the market already relies on agents*. Services range from let-only arrangements to full property management. Choosing an ARLA‑qualified agent who regularly trains its staff on evolving regulations has become a vital part of risk mitigation.
*Source: www.goodlord.com/state-of-the-lettings-industry-report-2025?utm_
4. Sector Consolidation Accelerates
We are entering a phase of PRS consolidation, with professional landlords acquiring portfolios from those exiting. Letting agencies are also merging or acquiring smaller players. A 2025 report from Reapit found that nearly 45% of agents surveyed had acquired or were considering acquiring another agency or rental book, highlighting a strong interest in consolidation and growth through strategic partnerships*.
This consolidation is likely to lead to:
Fewer landlords with larger portfolios
Fewer agencies managing more properties
More consistent standards and professionalisation
*Source: www.reapit.com/content-hub/reapit-property-outlook-report-2025?utm_
5. The Hidden Compliance Risk: Anti-Money Laundering (AML)
One overlooked but critical area of risk is AML compliance. According to HMRC data, between October 2024 and March 2025 HMRC issued 336 penalties for anti‑money‑laundering breaches, with lettings and estate agents receiving 194 fines totalling over £1.09 million, most for trading without AML supervision or failing to register appropriately. In 2024, another 324 agents were fined for similar failings, with total penalties exceeding £3 million*.
Since May 2025, new financial sanctions have made AML compliance non-negotiable. Landlords and tenants must check that their chosen agent meets not just property regulation standards, but also AML obligations – failure to do so could lead to service interruptions or legal consequences.
*Source: www.propertymark.co.uk/resource/further-tranche-of-agents-hit-with-penalties-for-aml-failures.html?utm_
6. Energy Efficiency: The EPC C Deadline
The latest news is that all rental properties must achieve an Energy Performance Certificate (EPC) rating of C by 1 October 2030. While this deadline has been extended, compliance remains a priority. Key points include:
A maximum spend of £10,000 on improvements
A 10% cap of property value for low-value homes
Landlords now have more time to plan upgrades strategically, potentially securing exemptions where appropriate. Early action will not only futureproof investments but also enhance property desirability.
The Private Rented Sector is evolving rapidly. The introduction of the Renters’ Rights Act 2025 is likely to:
Accelerate rental stock meeting required standards and being upgraded
Increase reliance on qualified letting agents
Reduce the number of landlords and agents operating outside legal and compliance frameworks
For tenants, this means a higher-quality, but likely higher-cost rental experience, alongside tougher competition for the remaining compliant properties. For landlords and agents, success will depend on embracing compliance, investing in training, and staying ahead of legal obligations.
Now, more than ever, it is important to trust a qualified letting agent to manage your property and ensure both you and your let properties are fully compliant. At Chestertons, we are here to support landlords through every stage of these changes. Whether you prefer to get in touch by email at [email protected], speak directly with one of our lettings experts, or visit one of our local offices, our teams are on hand and ready to help.