In 2025, the UK rental market is undergoing significant changes due to new legislation and policy updates. In this guide, we'll cover the new rules that you need to know and what you can do to prepare. Let's get into it.
What new rules will affect landlords this year?
Landlords in the UK face several key regulatory changes in 2025. These new rules aim to enhance tenant protections and improve property standards. Below, we break down the top five key updates that will shape the private rental sector this year.
1. The Renters' Rights Bill
The Renters' Rights Bill is set to introduce some of the most substantial changes to the private rental market in decades. Though there's no set date for it to come into effect, it's likely to be in the first half of 2025. Some of the key provisions include:
Abolition of Section 21 'no-fault' evictions: Landlords will no longer be able to pursue a possession order without providing a valid legal reason.
Introduction of periodic tenancies: Fixed-term tenancy agreements will be phased out, with all tenancies moving to a rolling month-to-month basis. This will make it harder for landlords to regain possession unless they meet specific legal grounds.
Stronger protections against unfair rent increases: Landlords will only be allowed to increase rent once per year, and tenants will have more rights to challenge excessive increases through tribunals.
Upfront rent payment restrictions: Landlords will no longer be able to request multiple months’ rent upfront, preventing financial barriers for tenants.
Bans on rental bidding wars: The practice of tenants bidding against each other by offering higher rent than the advertised price will be prohibited.
2. Energy efficiency standards
New energy efficiency rules are under review, with the government consulting on potential changes to Energy Performance Certificate (EPC) requirements. Through its Warm Homes Plan, the government has committed to mandating EPC Band C by 2030 for privately rented homes. The energy minister, Miatta Fahnbulleh, said in January that:
"The government will consult shortly on increasing minimum energy efficiency standards in the domestic private rented sector. The consultation will include proposals for rented homes to achieve Energy Performance Certificate C or equivalent by 2030.
In this consultation, we will set out proposals on the exemptions regime for properties that cannot meet the proposed increased standard. We encourage landlords and other key stakeholders to feed into this consultation when it is published." (source)
3. Awaab’s Law: Stricter rules on housing conditions
Originally introduced for the social housing sector, Awaab’s Law is expected to be extended to private rental properties as part of the Renters’ Rights Bill (source). Named after Awaab Ishak, a toddler who tragically died due to mould exposure in his family’s rented home, this law will require landlords to:
Respond to dam and mould complaints within strict timeframes: Failure to act promptly could lead to legal action or financial penalties.
Conduct mandatory property condition assessments: Landlords may be required to carry out regular inspections to prevent serious health hazards.
Ensure properties meet minimum safety standards: This includes improving ventilation, insulation, and heating to prevent damp-related issues.
4. Selective licensing schemes
Selective licensing schemes are expanding across the UK, requiring landlords to apply for a licence before renting out properties in certain areas. Local councils implement these schemes to improve housing standards and ensure better management of rental properties.
Who needs a licence? If a landlord owns a property in a designated selective licensing area, they must apply for a licence, which typically costs between £500 and £1,000 per property.
What happens if you don’t comply? Renting out a property without the necessary licence can lead to fines of up to £30,000, rent repayment orders, and even a criminal prosecution.
Where is selective licensing being expanded? Many councils, including those in London, Manchester, Birmingham, and Liverpool, are introducing new selective licensing zones in 2025.
To stay compliant, landlords should check their local council’s website to see if their properties fall under a selective licensing scheme.
5. Stamp Duty Land Tax (SDLT) changes
From 1 April 2025, the way Stamp Duty Land Tax (SDLT) is calculated will change (source), potentially increasing costs for landlords purchasing additional properties. This means landlords purchasing investment properties after April 2025 will face higher upfront costs.
Higher SDLT rates for landlords: The additional 3% surcharge for landlords purchasing buy-to-let properties will remain, but the overall SDLT rates will increase.
Example of SDLT changes:
Current SDLT on a £250,000 property: £12,500
SDLT from April 2025: £15,000
How can landlords prepare for these changes?
With these new rules taking effect, landlords should take proactive steps to prepare. For example:
✅ Review existing tenancy agreements: Ensure they align with the new Renters' Rights Bill requirements, especially regarding eviction rules and rent increases.
✅ Plan for EPC and energy efficiency upgrades: Consider investing in insulation, double glazing, and energy-efficient heating systems to future-proof properties.
✅ Keep properties well-maintained: Regular inspections can help identify and resolve issues like damp and mould before they become legal problems.
✅ Seek professional advice: Speaking to a lettings agent, landlord and tenant solicitor, or tax advisor can help navigate these new regulations and ensure full compliance.
Top five things the Renters' Rights Bill will change
Above all else, the Renter's Rights Bill is expected to make huge waves for the rental sector. Here's a deep dive into the top five changes you should know about. Plus, you can learn more in our complete guide to the Renter's Rights Bill.
1. Abolition of Section 21 evictions
One of the most impactful changes is the elimination of Section 21 evictions. Previously, landlords could terminate tenancies without providing a specific reason, offering flexibility in managing rental properties. With the new legislation, landlords are now required to present a valid, legally defined reason for ending a tenancy. This reform aims to provide tenants with greater security and stability in their housing arrangements.
2. Limitations on upfront rent payments
The Renters' Rights Bill also addresses the issue of substantial upfront rent payments. Landlords will be stopped from demanding multiple months' rent in advance. This change is designed to make renting more accessible, particularly for individuals who may struggle to afford large initial payments. The legislation allows only the first rent period or any subsequent periods ending within one month to be paid upfront.
3. Restrictions on rent increases
To prevent unexpected financial burdens on tenants, the new rules suggest that landlords can increase rent only once per year, and any increase must align with the market rate. Additionally, the practice of rental bidding, where tenants are encouraged to offer higher rents to secure a property, will be banned. These measures aim to create a more transparent and fair rental market.
4. Conversion to periodic tenancies
The legislation mandates that all tenancies transition to periodic assured tenancies, with a maximum rent period of one month. This change eliminates fixed-term contracts, providing tenants with more flexibility and reducing the likelihood of abrupt tenancy terminations.
5. Enhanced tenant protections
The Renters' Rights Bill introduces additional safeguards for tenants, including protections for bereaved guarantors. As these regulations come into effect, landlords must stay informed and adjust their practices accordingly to ensure compliance and maintain positive relationships with tenants.
FAQs
How will the abolition of Section 21 affect landlords?
Landlords will need to provide a valid, legally defined reason to end a tenancy, such as rent arrears or a desire to sell the property. This change aims to provide tenants with greater security while ensuring landlords can still regain possession under justified circumstances.
What are the new energy efficiency requirements?
The government is consulting on changes to the EPC system, which may include reducing the validity periods for EPCs and expanding requirements to all HMOs. Landlords should stay informed about these developments to ensure compliance.
What is selective licensing?
Selective licensing schemes require landlords in designated areas to obtain licenses to let their properties. These schemes aim to improve housing standards and management practices.
How are Stamp Duty Land Tax rates changing?
From 1 April 2025, SDLT rates will increase. For example, the SDLT on a £250,000 property will rise from £12,500 to £15,000.
Final thoughts
2025 brings significant changes for landlords in the UK. Staying informed and adapting to these new regulations is crucial for maintaining compliance and ensuring successful property management. Engaging with professional bodies and seeking legal advice when necessary can help landlords navigate this evolving landscape effectively.
Disclaimer: Please note this article is intended for informational purposes only. This article does not advise on a specific situation, and we do not accept any liability for errors, omissions or misstatements. Always seek advice from a professional and refer to official government guidance.
