Landlords brace for Renters’ Rights Act with rent rises and stricter vetting

04 November 2025

• 81% of landlords say the new law will make them more selective about tenants
• 71% plan to raise rents to offset costs linked to the legislation
• 73% believe the Act will have a negative impact on their lettings activity

London, Tuesday 4th November 2025

Landlord research carried out by mortgage market specialist Pegasus Insight suggests that the newly enacted Renters’ Rights Act will drive rents higher as landlords respond to tougher regulation and greater compliance demands.

The Act, which received Royal Assent on 28th October, abolishes Section 21 ‘no-fault’ evictions, introduces open-ended tenancies, limits rent increases to once per year and caps advance rent payments at one month.

According to the Landlord Trends Q3 2025 report, 81% of landlords expect the legislation to make them more selective about prospective tenants, and 71% say they plan to raise rents to absorb new costs and restrictions. Meanwhile, 73% of landlords believe the Act will have a negative impact on their own lettings activity and 81% think it will negatively impact the wider Private Rented Sector (PRS).

Mark Long, founder and managing director of Pegasus Insight, said:

“The Renters’ Rights Act marks one of the most significant shifts in the private rented sector in decades, and many landlords are preparing cautiously.

“Faced with stricter limits on rent reviews and growing uncertainty around evictions, they’re acting pre-emptively to protect income and manage risk. These are rational business responses, but they risk compounding the affordability pressures tenants are already facing.”

Pegasus Insight’s research also highlights a growing disconnect between landlord and tenant expectations. While landlords anticipate higher costs and reduced flexibility, tenants tend to see the reforms as a win for renters.

Long added:

“Our recent Tenant Trends research found that almost half of renters believe the Renters’ Rights Act will benefit them, largely due to stronger protections and limits on rent rises.

“But the corresponding Landlord Trends data tells another story: four in five landlords say they’ll be more choosy about who they let to, and two-thirds intend to raise rents in response to the new rules.

“This mismatch between perception and reality underlines how complex PRS reform can be: policies designed to protect tenants could, unintentionally, make it harder for them to find and afford a home.”