The pricing landscape for English lettings is about to change dramatically. From 1 May 2026, The Renters' Rights Act 2026 introduces strict new rules governing how much rent can be charged, when it can be increased, and how properties must be advertised. These changes target two of the most controversial aspects of the current market: aggressive rent increases and bidding wars that lock tenants into unsustainable financial commitments.
For landlords and agents who've operated under the existing regime for years, these new pricing rules represent a fundamental shift in strategy. Understanding them isn't optional: it's essential for compliance and maintaining professional standards.
Under the new framework, landlords can only increase rent once per year using the formal Section 13 notice process. This replaces the current system where contractual rent review clauses could trigger increases every six months, or even more frequently in some cases.
The Renters' Rights Act 2026 goes further by making all contractual rent review clauses unenforceable from May 2026 onwards. Even if a tenancy agreement was signed before that date and includes automatic escalation clauses, those provisions will no longer hold legal weight. Every rent increase must now follow the statutory process.
The Section 13 process requires landlords to serve formal written notice to tenants at least two months before the proposed increase takes effect. This notice period gives tenants time to review the proposed change, assess their financial position, and decide whether to accept it or challenge it through the tribunal system.
Critically, rent cannot be increased during the first year of any tenancy. This protection ensures new tenants have financial stability for at least 12 months after moving in, regardless of market fluctuations during that period.
Every proposed rent increase must meet a new legal standard: it must reflect the current market rate for similar properties in the same area. Specifically, the increase must align with what the landlord could reasonably expect to charge if they were advertising the property to new tenants on the open market today.
This replaces the previous "fair and realistic" test with a clearer, more objective benchmark. If a two-bedroom flat in your area typically rents for £1,200 per month and your tenant currently pays £1,000, you can justify an increase toward that market rate: but not beyond it.
The market-rate requirement creates a natural ceiling that prevents excessive increases while still allowing landlords to respond to genuine market shifts. It also means landlords need to stay informed about local rental values and be prepared to evidence their proposed increase if challenged.
One of the most significant changes in The Renters' Rights Act 2026 is how it empowers tenants to challenge rent increases without fear of retaliation.
Under the current system, many tenants hesitate to dispute rent increases because they fear landlords might respond by ending their tenancy using Section 21. With Section 21 abolished (as covered in Chapter 1), tenants can challenge increases at the First-tier Tribunal without worrying about retaliatory eviction.
This protection fundamentally changes the power dynamic. Tenants who believe an increase is above market rate or excessive can now pursue formal dispute resolution without risking their home.
Perhaps the most important procedural change is how tribunal decisions affect rent payments. Under current law, if a tenant challenges an increase and the tribunal later sets a different rate, the revised rent is backdated to when the original increase was supposed to take effect. This can leave tenants owing significant arrears even if they "win" their case.
From May 2026, tribunal decisions will no longer be backdated. If a tenant challenges an increase, they continue paying their current rent until the tribunal makes a determination. If the tribunal approves a higher rent than the current rate, that new rent only applies from the date of the decision forward: not retrospectively.
This change removes the financial risk that currently discourages tenants from using the tribunal system. It also means landlords need to ensure their proposed increases are genuinely justifiable from the outset, rather than relying on tenants' reluctance to challenge.
Alongside rent increase restrictions, The Renters' Rights Act 2026 introduces a comprehensive ban on rental bidding wars: a practice that became increasingly common in competitive markets and drove rents beyond sustainable levels for many tenants.
The Renters' Rights Act 2026 defines a bidding war as any situation where a landlord or letting agent:
All three behaviours are now explicitly prohibited. The ban applies equally to landlords managing their own properties and professional letting agents acting on behalf of property owners.
Every rental property must now be advertised with a fixed asking rent. That figure becomes the maximum amount that can be charged to any tenant who applies for the property during that advertising period.
If market conditions change or the landlord realizes the asking rent was set too low, they must withdraw the property from the market, reassess, and re-advertise at the new price. They cannot simply accept higher offers from eager applicants while the property is actively listed at a lower rate.
This requirement mirrors frameworks introduced in other jurisdictions: most notably New Zealand's 2021 rental bidding ban: that aimed to reduce competition-driven rent inflation and create more transparent pricing.
While the ban is clear in principle, enforcement presents practical difficulties. Proving that a landlord or agent "encouraged" a higher bid rather than simply accepted an unsolicited offer from a tenant may prove challenging in practice.
There's also a risk of unintended consequences. Some market observers suggest landlords may respond by advertising properties at inflated prices from the outset, building in a buffer that previously would have come through competitive bidding. If that becomes standard practice, the ban may achieve transparency without meaningfully controlling rent levels.
For landlords and letting professionals, these changes require significant operational adjustments before May 2026.
Any tenancy agreement signed before May 2026 that includes contractual rent review clauses will need to be reviewed. While existing contracts don't need to be rewritten immediately, landlords should understand that those clauses will become unenforceable once The Renters' Rights Act 2026 takes effect.
Future rent increases for those tenancies will need to follow the Section 13 process regardless of what the original agreement stated.
Landlords planning rent increases must now be prepared to evidence their market-rate justification. This means keeping records of comparable properties, monitoring local rental listings, and potentially obtaining professional valuations if increases are likely to be challenged.
Good documentation protects both parties: it gives landlords confidence their increase is defensible, and it provides transparency for tenants considering whether to accept or challenge.
The ban on bidding wars means letting agents and landlords need to price properties accurately from the outset. Setting an artificially low asking rent to generate interest and then accepting higher offers is no longer permissible.
This shift requires better market analysis upfront and potentially longer void periods if initial pricing proves too ambitious. It also means clearer communication with landlords about realistic rent expectations in the current market.
These pricing reforms aim to create greater stability and predictability for both tenants and landlords. Tenants gain protection from aggressive mid-tenancy increases and competitive bidding pressure. Landlords retain the ability to adjust rents in line with genuine market movements while operating within a clearer regulatory framework.
The transition period between now and May 2026 is the time to prepare systems, review agreements, and ensure pricing strategies align with the new legal requirements. Those who adapt early will find the transition smoother: and will be better positioned to maintain professional standards in the reformed market.
Let Tech Solutions Ltd is an Appointed Representative of George Stubbs Insurance Services Ltd, which is authorised and regulated by the Financial Conduct Authority.
