How the Renter’s Rights Act will affect you

Renters’ Rights Act: New Fines of up to £40,000 for Landlords – What You Need to Know

Private landlords in England are facing the most significant overhaul of tenancy law in a generation. From 1 May 2026, key provisions of the Renters’ Rights Act 2025 will begin to apply, backed by a far tougher enforcement regime and sharply increased financial penalties.

Under new statutory guidance to local authorities, landlords who breach the rules – even inadvertently – could face fines of up to £40,000 for repeat non-compliance, as well as higher rent repayment orders and tighter investigatory powers for councils. Industry bodies warn that well‑intentioned landlords risk being caught out by complex, unfamiliar requirements.

This article explains the main changes, the new fines, and the practical steps landlords should take to stay compliant.

A New Enforcement Landscape

The Renters’ Rights Act 2025 received Royal Assent on 27 October 2025 and will be implemented in phases from late 2025, with the core tenancy reforms and most of the new penalties taking effect on 1 May 2026, subject to secondary legislation and guidance being finalised.

Key elements of the enforcement framework, as set out in government guidance and parliamentary briefing material, include:

• Greatly expanded civil penalties for a broad range of offences, including unlawful eviction, harassment, illegal discrimination and breaches of safety and property standards.
• Stronger rent repayment orders, with the maximum amount doubled to up to two years’ rent and extended to cover more types of offence, particularly for repeat offenders [House of Commons Library briefing; government guidance].
• New investigatory powers for local authorities from 27 December 2025, allowing councils to inspect properties, compel documents and access third‑party data where they suspect breaches of private rented sector legislation [House of Commons Library briefing; government guidance].

A number of fines will be set at levels which, for small landlords in particular, could be financially devastating. Experts emphasise that ignorance of the new regime will not be a defence.

Allison Thompson, national lettings managing director at Leaders, warns that “well‑intentioned landlords are exposed to significant penalties for technical or procedural errors, especially where the rules are new, complex and still bedding in.” She notes that relatively simple administrative or timing mistakes could now carry penalties approaching those previously reserved for serious safety failures.

Timothy Douglas, head of policy at Propertymark, describes the approach as “heavy‑handed legislation,” arguing that while targeting rogue landlords is welcome, the scale of fines and the doubling of rent repayment orders “will be a terrifying prospect to many landlords who are already taxed to the hilt.”

The End of ‘No‑Fault’ Evictions and a 12‑Month Protected Period

At the heart of the Act is a complete restructuring of private tenancies:

• Section 21 ‘no‑fault’ evictions will be abolished. Landlords will no longer be able to end an assured tenancy without a specified ground for possession. Instead, they must rely on updated and expanded section 8 grounds, such as rent arrears, serious anti‑social behaviour, sale of the property or a landlord/family member moving in [GOV.UK guidance; House of Commons Library briefing].
• All fixed‑term assured and assured shorthold tenancies will be replaced by open‑ended periodic assured tenancies. From 1 May 2026, new and existing qualifying tenancies will generally convert to rolling contracts, with tenants able to give two months’ notice at any time [GOV.UK guidance; NRLA guidance].

In addition, tenants gain a 12‑month protected period at the start of every tenancy. During this period, landlords cannot evict in order to:

• Sell the property; or
• Move in themselves or house a close family member.

Once the 12 months have elapsed, landlords using these grounds must provide four months’ notice, giving tenants more time to secure alternative accommodation.

The 12‑Month ‘No‑Let’ Rule – and a £25,000 Fine

To prevent misuse of the new possession grounds, the Act introduces a critical anti‑avoidance measure:

• If a landlord regains possession on the ground that they intend to sell the property or move in (or house family), they are prohibited from marketing or re‑letting that property for a further 12 months, save for tightly defined exceptions.

If a landlord breaches this prohibition – for example, by evicting a tenant claiming they will sell, then re‑letting the property within a year – they could face a civil penalty of up to £25,000 under the new guidance.

Practitioners highlight that this is an area where well‑meaning landlords could easily fall foul of the rules: sales collapsing, changes in personal circumstances or problems refinancing might all lead an owner to decide not to sell and instead to re‑let. Under the new regime, doing so within the 12‑month period could trigger a substantial penalty, even if the original intention to sell was genuine.

Abolition of Fixed‑Term Tenancies – Fines for Non‑Compliance

From 1 May 2026:

• Fixed‑term assured and assured shorthold tenancies in the private sector will be abolished and replaced with rolling periodic tenancies.
• Tenants will no longer be contractually tied into long fixed terms; instead, they may end the tenancy at any point with two months’ notice [GOV.UK guidance; NRLA guidance; independent landlord commentary].

Landlords or agents who continue to advertise or grant fixed‑term assured or assured shorthold tenancies in contravention of the new regime may face civil penalties of up to £4,000.

This will require a fundamental change to standard letting documentation and processes. Landlords will also be required, by a specified deadline, to provide existing tenants with an official government information sheet explaining the new rules, rather than re‑issuing contracts.

Banning Rental Bidding Wars – New Fines on Advertised Rent

To tackle bidding wars and opaque rent setting, the Act:

• Prohibits ‘rental bidding’: landlords and letting agents must publish a single asking rent and are banned from inviting, encouraging or accepting offers above that figure.
• Makes it unlawful to accept rent above the advertised amount, with a maximum fine of £4,000 where this is breached.
• Requires that rental adverts clearly state the proposed rent; failure to specify a rent in an advert may attract a separate civil penalty of up to £3,000 [GOV.UK guidance; NRLA guidance; House of Commons Library briefing].

Landlords may still review rents annually, but must do so using a statutory section 13 process, with increases limited to once per year and subject to at least two months’ notice. Tenants will have the right to challenge proposed increases they consider above market level at the First‑tier Tribunal, which will no longer be able to set rent higher than the landlord initially proposed.

Ban on Discrimination Against Tenants with Children or on Benefits

The Act introduces a statutory ban on rental discrimination:

• Landlords and agents will be prohibited from directly or indirectly discriminating against prospective tenants because they have children or because they receive benefits.
• This will outlaw blanket bans (such as advertising “no DSS” or “no children”) and policies that, in practice, exclude such groups without objective justification.

Breaches may result in a civil penalty of up to £6,000, and may also expose landlords or agents to claims under existing equality and consumer protection law [GOV.UK guidance; House of Commons Library briefing; sector commentary].

Serving Notice Correctly – Section 8 Procedure and a £6,000 Penalty

With section 21 being abolished, the only lawful route to possession will be via the updated Section 8 regime (or, in limited cases, agreed surrender).

Landlords must:

• Rely on one or more of the statutory grounds for possession (e.g. serious rent arrears, persistent delay in paying rent, anti‑social behaviour, landlord moving in or selling).
• Serve the prescribed Form 3 notice correctly, giving the appropriate notice period under the relevant ground(s).
• Issue court proceedings if the tenant does not leave by the expiry of the notice and they still wish to recover possession.

Improper attempts to terminate a tenancy – such as giving informal notice by phone or email, demanding that tenants leave without a valid ground, or serving a defective notice – could lead to a civil penalty of up to £6,000.

Unlawful Eviction and Harassment – Fines up to £35,000

Unlawful eviction and harassment of tenants remain criminal offences under the Protection from Eviction Act 1977, but the Renters’ Rights Act significantly strengthens civil enforcement:

• Unlawful eviction includes forcing a tenant out without a court order, changing locks, physically excluding them from their home or otherwise depriving them of occupation without due process.
• Harassment can include entering the property without consent (except in genuine emergencies, or where permitted by the tenancy agreement and proper notice has been given), repeated threats, interference with services (e.g. disconnecting gas, electricity or water), and other conduct intended to drive a tenant out.

Local authorities will be able to impose civil penalties of up to £35,000 for unlawful eviction and harassment, in addition to – or as an alternative to – criminal prosecution. Tenants may also be entitled to rent repayment orders and civil damages.

Rent Repayment Orders – Up to Two Years’ Rent

Rent repayment orders (RROs) allow tenants (and in some cases local authorities) to seek repayment of rent where certain offences have been committed, such as:

• Illegal eviction or harassment;
• Managing or operating an unlicensed House in Multiple Occupation (HMO) or other licensable property;
• Certain serious breaches of housing and safety legislation.

Under the Act:

• The maximum amount repayable will double from the equivalent of 12 months’ rent to 24 months’ rent in the most serious or repeated cases.
• RROs will be extended to cover further offences and to apply to “superior landlords” in some circumstances [House of Commons Library briefing; GOV.UK guidance].

For landlords with HMOs or other licensable properties, failing to maintain the correct licence could therefore result not only in increased civil penalties but also in an order to repay up to two years’ rent.

Property Standards, Awaab’s Law and the Decent Homes Standard

The Act also introduces a new statutory Decent Homes Standard for the private rented sector, aligned with provisions in the social housing sector and supported by Awaab’s Law.

Key elements include:

• A requirement that homes be free from serious health and safety hazards, kept in a reasonable state of repair, adequately heated, ventilated and free from dangerous damp and mould.
• Strict timeframes within which landlords must investigate and remedy certain serious hazards, particularly issues such as damp, mould and structural risks that may endanger occupants’ health [GOV.UK guidance; government consultation material].

Local authorities will gain powers to issue civil penalties of up to £7,000 where landlords fail to take reasonable steps to keep their properties free from serious hazards or do not comply with the timescales and remedial requirements under Awaab’s Law‑related provisions.

Although detailed implementation of the Decent Homes Standard in the private rented sector will follow further consultation, landlords should expect more rigorous inspection and enforcement of property conditions.

New Investigatory Powers for Councils

From 27 December 2025, before many of the tenancy changes take effect, local authorities acquire an enhanced suite of investigatory powers, including:

• Powers to enter and inspect properties, often without prior notice in urgent or high‑risk cases;
• Powers to require documents and information from landlords, agents and third parties (for example, letting platforms or utility providers);
• Powers to access and use data to identify non‑compliant landlords and target enforcement activities [House of Commons Library briefing; GOV.UK guidance].

Councils will also have new reporting obligations, which will create pressure to demonstrate active enforcement and may lead to more frequent use of civil penalties.

Repeat Offenders and £40,000 Fines

The government’s policy intent is clear: repeat or deliberate non‑compliance should attract the harshest penalties.

Under the new framework:

• Certain fines, such as those for serious or repeated breaches of the Decent Homes Standard or for systematic unlawful practices, can be escalated up to £40,000 for repeat offenders, in addition to rent repayment orders and other sanctions.
• Guidance encourages local authorities to apply maximum penalties where the landlord has a history of non‑compliance or where the conduct has caused significant harm or financial detriment to tenants.

Rogue landlords may therefore find that repeated or multiple breaches quickly become economically unsustainable – which is precisely the policy objective. The concern frequently voiced by industry representatives is that smaller, generally compliant landlords might also be caught out by technical failures.

Additional Structural Changes Landlords Must Prepare For

Beyond the headline fines, the Act introduces several structural reforms which carry their own compliance risks:

1. Private Rented Sector Database
   A national database will be created, on which landlords must register themselves and their properties. Registration will be a precondition for using certain possession grounds, and non‑registration or provision of false information will be an offence in itself, likely subject to civil penalties.
2. Mandatory Redress via a Private Rented Sector Landlord Ombudsman
   All private landlords will be required to join an approved ombudsman scheme once operational. The ombudsman will have binding powers to require apologies, remedial works and compensation, sitting alongside local authority enforcement powers.
3. Restrictions on Rent in Advance and Up‑Front Payments
   For new assured periodic tenancies, landlords will be barred from demanding rent in advance before a tenancy agreement is signed, and – once signed – from requiring more than one month’s rent in advance at any one time, except in narrowly defined circumstances.
4. Pets and Tenants’ Requests
   Tenants will be granted a statutory right to request permission to keep a pet, which landlords must consider and may not refuse unreasonably. While not directly tied to the largest fines, failure to handle such requests properly could form part of a pattern of non‑compliance scrutinised by councils or the ombudsman.

Practical Steps for Landlords

Given the complexity and breadth of the reforms, landlords should begin preparing well in advance of May 2026. Sensible measures include:

1. Audit Existing Tenancies and Documentation
   • Identify all assured and assured shorthold tenancies that will convert to periodic agreements.
   • Review clauses on term, rent increases, pets, fees and notices to ensure they will be compatible with the new regime.
   • Plan how and when to provide tenants with the government information sheet.
2. Review Possession Strategies
   • Familiarise yourself with the updated section 8 grounds and timescales, particularly the new 12‑month protected period and four‑month notice for sale/move‑in grounds.
   • Avoid serving section 21 notices close to the transition date without legal advice on timetables and court deadlines.
3. Prepare for Rent‑Setting Changes
   • Establish a robust process for annual rent reviews via section 13, including evidence of market rents should a tenant challenge an increase.
   • Update advertising practices to ensure a single, clearly stated asking rent and internal controls to prevent acceptance of offers above that figure.
4. Review Advertising and Letting Policies for Discrimination Risks
   • Remove any direct or indirect exclusions of benefit recipients or families with children from adverts, application forms and screening processes.
   • Train staff and agents on the new anti‑discrimination rules and existing equality law obligations.
5. Check Licensing and Property Condition Compliance
   • Confirm that all HMOs and other licensable properties are correctly licensed and that licence conditions are being met.
   • Undertake proactive inspections focusing on damp, mould and other hazards likely to be captured under Awaab’s Law and the Decent Homes Standard.
   • Put in place clear repair reporting and response procedures, tracking timescales and works completed.
6. Record‑Keeping and Communication
   • Maintain comprehensive written records of all communications with tenants, notices served, rent demands, repairs and inspections.
   • Ensure data is easily retrievable in the event of a local authority investigation or tribunal hearing.
7. Engage with Professional Advice and Training
   • Consider membership of a reputable landlord association or professional body to keep abreast of evolving guidance and best practice.
   • Seek specialist legal advice where contemplating possession action, complex rent changes or significant works.

Conclusion

The Renters’ Rights Act marks a decisive shift towards a more regulated, enforcement‑driven private rented sector in England. While the majority of provisions are designed to protect tenants from insecure tenancies, poor conditions and unfair treatment, the accompanying schedule of fines is severe.

Landlords who fail to adapt – even through misunderstanding or oversight – risk penalties running into tens of thousands of pounds, rent repayment orders of up to two years’ rent, and reputational damage that may be difficult to repair.

Those who invest time now in understanding the new framework, updating their practices and ensuring robust compliance systems will be best placed to navigate the transition and continue to operate successfully in a more demanding regulatory environment.