The Renters’ Rights Act: A system under strain for landlords and investors

The Renters’ Rights Act 2025 represents a fundamental shift in how the private rented sector operates. It aims to create a fairer, more secure environment for tenants, but for owner-managed businesses, property investors and landlords with a portfolio, the practical implications are far more nuanced.

From a property disputes perspective, this represents a more structural change, and it moves the balance of power away from informal landlord control and firmly into the hands of a formal legal system. It’s likely that courts and tribunals will now sit at the heart of resolving everyday tenancy issues and repeatedly the question that must be re-visited is whether that system is equipped for what’s coming next?

Will we see a fundamental shift in how disputes arise?

Historically, landlords have had the comfort of being able to serve 2 months notice at any time to manage their tenancies and regain possession when any issues arose, but in line with the new Act, the removal of “no-fault” evictions changes that entirely. Possession will now almost always require a prescribed legal process to be followed, with supporting evidence, which leads to a court hearing.

At the same time, you could say that post 1 May 2026 tenants are being given greater confidence to be challenging. Rent increases, for example, can now go to tribunal more easily with little or fewer barriers, so what may previously have been resolved through a simple conversation some would argue now has a clear route into formal legal dispute processes.

For owner-managers, this could mean that where issues that were once handled quickly and pragmatically, may now become legal disputes.

Does more claims mean more complexity?

The likely impact that we’ll see is not just an increase in disputes, but also a shift in their nature.

As the Act progresses, I expect that we’ll see an increase in cases where tenants contest their rights, because they are less vulnerable as occupiers, which may lead to volume increases in the number of cases, and perhaps also complexity.  As with any legal process, they require supporting documents and time which, for businesses or owners introduces an additional layer of increased cost and uncertainty.

The difficulty is that this increased demand is putting pressure on a system that is already stretched. Possession claims already take quite some time (years in some cases) to make their way through the courts and Tribunals and the courts are already strained, so any increase in claims volumes will extend those timelines even further.

For owner-managed businesses it could affect cash flow and the ability to make timely property-related decisions. A drawn out possession process for example, could have a direct impact on incomes and an ability to pay mortgages - particularly for those with smaller property portfolios.

What this means in practice for landlord

For landlords, being prepared will be key.

Robust record-keeping and taking early legal advice will play a big role in managing your risk and any decisions about rent and tenancy management will need to be made early and with the expectation or understanding that they could be scrutinised formally, if a dispute happens.

What this means for you

The direction of travel is clear  - we will have a more regulated and structured rental market.

It shouldn’t be seen as negative – it’s giving us greater clarity, and the fairness should benefit the sector as a whole.

For owner-managed businesses, the risk is that you’ll navigate a system that is still playing catch up.

For landlords and investors, the focus now should be on adapting early, understanding the new rules, and putting the right processes in place to safeguard you before pressure on the system begins to escalate.