Thursday, 22nd January 2026

Key UK Property Law Changes Taking Effect in 2026

The UK property landscape is undergoing transformational change across residential lettings, commercial leasing, building safety, housing standards and taxation. Below we summarise key reforms, relevant consultation and implementation timelines, and practical implications for landlords, investors, developers and property professionals in England and Wales.

1.Renters’ Reform & Abolition of Section 21 “No-Fault” Evictions

The Renters’ Rights Act 2025 received Royal Assent on 27 October 2025 and introduces one of the key fundamental overhauls of the private rented sector in a generation.

Implementation Phases

• 27 December 2025: Strengthened investigatory and enforcement powers for local authorities come into force ahead of tenancy reforms.
• 1 May 2026:
  • Abolition of section 21 no-fault evictions under section 21 of the Housing Act 1988 conversion of assured shorthold tenancies into periodic assured tenancies with rent periods not exceeding one month
  • Reformed possession grounds which have been amended and expanded, requiring landlords to give valid reasons for seeking possession. Evictions of tenants without cause will therefore become increasingly difficult.
  • Tenants will benefit from a 12-month protected period at the start of a tenancy, where they cannot be evicted on grounds relating to the landlord seeking reoccupation or sale of the property.
  • The Act also places limits on rent increases to once per year, prohibits discrimination against prospective tenants with children or those receiving benefits, and on rent bidding.
  • Provides tenants with the right to request consent to keep pets, which landlords cannot unreasonably refuse.

• Late 2026: Roll-out of the Private Rented Sector (PRS) Database and establishment of the PRS Landlord Ombudsman. This is expected to be mandatory by 2028.
• Future updates: Consultation outcomes will determine timing of Decent Homes Standard, Awaab’s Law extension to the PRS, and enhanced housing standards.

Deadlines & Transitional Rules

• Landlords should serve valid section 21 notices before 30 April 2026 if they intend to rely on them. Possession proceedings must be commenced within the applicable period to rely on the notice, being six months from the date the notice was served, or three months from 1 May 2026 whichever is sooner. If the notice is served under Section 21(4)(b) of the Housing Act 1988, then the applicable period is four months from the date specified in that notice or three months from 1 May 2026, whichever is sooner. Failure to serve valid Section 21 notices before 1 May 2026 will result in the assured shorthold tenancy converting to a periodic assured tenancy and the existing tenancy will be subject to the new regime.
• Government guidance for landlords and tenants is being published in the run-up to May 2026 to support compliance.

 

2. Proposed Ban on Upward-Only Rent Reviews in Commercial Leases

The Government has proposed a statutory prohibition on upward-only rent review (UORR) clauses in new and renewal commercial leases as part of the English Devolution and Community Empowerment Bill, first introduced into Parliament on 10 July 2025. The intended aim of these provisions is to safeguard tenants from inflated rents during difficult economic climates and market downturns.

• Clause 71 of the Bill seeks to amend the Landlord and Tenant Act 1954 (LTA 1954) by adding Schedules 7A and 7B, prohibiting upward-only rent reviews in new commercial leases and renewal leases in England and Wales and prohibiting put options that require tenants to enter into new leases where the initial rent cannot be determined at the time the option is agreed (requiring the starting rent for the new lease to be equal to the rent payable under the previous lease) respectively.
• The prohibitions in Schedules 7A and 7B would only apply to new leases. Index-linked rent reviews would still be permitted if the resulting rent can be lower than the passing rent. Stepped rents (pre-determined rent levels ascertained at the start of the lease) would also not be caught by this prohibition.
• Draft provisions (Schedule 31 of the Bill) would bar clauses that prevent downward movement of rent on review and introduce rights for tenants to trigger rent reviews.
• The Bill passed its Committee stage and has progressed to the Report stage in the House of Commons (as at late 2025). The Bill is currently in its Committee stage in the House of Lords (as at 15/01/2026).
• This reform, if enacted, is likely to affect rental income predictability and asset valuations, forcing landlords and occupiers to rethink rent review mechanics and potentially adopt fixed or flexible market-adjusted reviews instead of traditional upward-only mechanisms.

 

3. Building Safety Levy (England) — Effective 1 October 2026

The Building Safety Levy (BSL) is set to be introduced from 1 October 2026 following introduction of the Building Safety Levy (England) Regulations 2025 (SI 2025/1236).

• The BSL is a new tax introduced under the Building Safety Act 2022 that will apply when developers seek permission to develop certain residential buildings in England.
• The Government has published guidance on how the levy is expected to operate enabling developers and local authorities to plan accordingly.
• The levy may be subject to changes before its expected implementation in October 2026.

 

4. Leasehold & Freehold Reform Act 2024 — Enfranchisement Changes

The Leasehold and Freehold Reform Act 2024 has introduced a range of enfranchisement and lease extension reforms following longstanding pressure from leaseholders and industry groups.

• Key provisions (including changes to qualification periods and marriage value treatment) have commenced or are in the process of being brought into force via secondary legislation.
• The legislation prohibits the grant of new long residential leases for houses, subject to certain permitted exceptions (yet to come into force).
• Qualifying tenants of houses and flats will be entitled to extend their leases by 990 years, replacing the previous 50 years for houses and 90 years for flats respectively. The lease extensions are required to be granted at a peppercorn rent.
• Restrictions on tenants from bringing a new claim to enfranchise or extend their lease within 12 months of an earlier failed lease extension have been removed, together with restrictions on limiting lease extensions of houses to only one lease extension is also removed.
• From 31 January 2025, qualifying tenants no longer need two years of ownership to issue a claim to extend their lease through the statutory process.
• The Act also introduces new valuation methods for calculating the premium payable for freehold enfranchisement or lease extensions with the abolition of marriage value calculations (yet to be implemented).
• The threshold for non-residential use in a mixed-use building was increased from 25% to 50% of internal floor space (excluding communal areas).
• Shared ownership leaseholders will gain rights to extend their leases (excluding rights to enfranchise and acquire the freehold or participate in collective enfranchisement claims).
• Disputes related to enfranchisement and lease extension claims will primarily be dealt with by the First Tier Tribunal (Property Chamber) in England and the Leasehold Valuation Tribunal in Wales, removing claims to the High Court.

 

5. Section 10A of the Landlord and Tenant Act 1985

The Social Housing (Regulation) Act 2023 created a new Section 10A of the Landlord and Tenant Act 1985, creating an implied covenant in relevant social housing leases that require landlord to comply with prescribed requirements regarding hazard, such as damp and mould.

• The Hazards in Social Housing (Prescribed Requirements) (England) Regulations 2025/1042 defined “significant hazards” as a risk that a reasonable landlord would urgently address (such as mould, damp or fungal growth) and “emergency hazards” as imminent and significant risks requiring action within 24 hours.
• Landlords are required to investigate and complete relevant safety works as soon as reasonably practicable (and within 24 hours for emergency hazards) to make the home safe and prevent the recurrence of the hazard.
• Breaches are enforced as a breach of implied covenant against landlords.

 

Our team remains ready to support you with tailored advice on compliance, risk mitigation and strategic planning in response to these reforms.  If you have any queries regarding this note or require further information about anything covered, do get in touch with Sharado Watson or your usual contact at the firm on +44 (0)20 7526 6000.

This article is for general purpose and guidance only and does not constitute legal advice.  It should not replace legal advice tailored to your specific circumstances.