Rent regulation is back
By Matt Hutchings KC
The big news about the Renters’ Rights Act 2025 (the “RRA”) is of course the abolition, we are told from 1 May 2026, of ASTs and with them no-fault evictions under section 21 of the Housing Act 1988 (the “HA”). In that context, it may have slipped under the radar a bit that sections 6 and 7 of the RRA introduce a sizeable shift in rent regulation in the private sector, in a way that has a distinctly retro feel for those of us old enough to remember the Rent Acts.
Section 13 of the HA enacts a scheme under which the landlord is required to serve a prescribed form of notice of rent increase, following which the tenant has the opportunity to refer the rent increase to the First-tier Tribunal (Property Chamber) within a specified period, usually one month. Section 14 provides for the Tribunal to determine the open market rent following an in-time referral by the tenant in response to a landlord’s notice under section 13.
However, as currently in force, the above statutory scheme is effectively optional for landlords. Section 13(1) provides that it only applies to a statutory periodic tenancy, or any other periodic assured tenancy which does not have a binding rent review clause. In Contour Homes Ltd v Rowen [2007] 1 WLR 2982, the Court of Appeal held that this exception applies to an ordinary rent review clause, so the tenant in that case had no right to refer the rent increase to the Tribunal. This wide exception has given rise to nice disputes about whether a purported rent review clause is really a rent review clause or merely a summary of the effect of sections 13 and 14, see: Helena Partnerships Ltd v Brown [2015] UKUT 0324 (LC).
The RRA’s mandatory framework
This jurisprudence will from 1 May 2026 be consigned to history as a result of the relevant provisions of the RRA coming into force. The substance of the prospective changes is to impose the section 13 – 14 scheme on all assured tenancies, except social housing tenancies: see section 13(1) and (4C) as prospectively amended. Social housing tenancies are by definition let at below market rent, hence the Tribunal’s more limited role in such cases will be to determine the validity of any notice of rent increase under new sections 13A and 13B.
Leaving aside social housing tenancies, pursuant to section 13(4A), there will only be three ways for the landlord to increase the rent: by two months’ notice under section 13 which is unopposed, a Tribunal determination under section 14, or if the landlord and tenant agree a lower rent increase following such a notice or determination. Not only that, but the tenant will also have the right to refer the contractually agreed rent to the Tribunal within the first six months of the tenancy: section 14(A1)-(A2).
Potential market implications
One might argue that these reforms are long-overdue, and will not significantly depress rents, given that the already overcooked private rental market will doubtless see a rent surge as it reacts to the legislative reset of security of tenure. The Government’s stated purpose in the Explanatory Notes that accompanied the Bill is: “to prevent above-market rent increases being used to force tenants to vacate a property.”
However, in the longer term, the effect on rents might be more wide-ranging. Market rents are determined by reference to comparables. Whilst in theory this ensures that the Tribunal follows the market, the full picture is not that simple. The First-tier Tribunal’s expanded jurisdiction will confer a greater power on the Tribunal to influence the market, not only directly by determining rents referred to it, but also by setting the tone for the market. If a landlord knows that a similar property nearby had a recent rent determination at certain level, given his tenant’s right to refer the proposed rent increase, it is likely he will pitch his notice at that level.
