Landlords are rushing to offload property ahead of the Renters Rights Act coming into force on Friday, claiming the legislation is “the final straw” in a market that is no longer commercially viable.
Kent and London law firm Thackray Williams says its litigation team has had a wave of last-minute instructions from landlords who want to issue Section 21 ‘no fault’ eviction notices for their entire buy-to-let portfolios and beat the 1st May deadline.
The result, the firm’s conveyancing team says, will be a wave of houses and flats flooding the market.
Conveyancing partner Claire Josef said: “We’re anticipating increased instructions for our conveyancing team as these landlords put their properties on the market as soon as they are able, which in turn could negatively impact property prices, particularly in areas that have traditionally had a strong rental sector.”
Under the Renters Rights Act, all assured shorthold tenancies (ASTs) will be abolished and replaced with periodic assured tenancies. If a valid Section 21 notice is served before 1st May, the tenancy will remain an AST until the landlord obtains possession and the tenancy ends, the notice lapses, or a judge decides the notice is invalid.
Mustafa Sidki, contentious construction litigation partner at Thackray Williams, explained: “While many landlords have planned ahead for this, we are seeing a significant number of last-minute applications to serve Section 21 notices by Thursday from landlords who have decided property investment is now too challenging to be viable.”
With fixed rate mortgage deals coming to an end, new reporting obligations introduced by Making Tax Digital, and changes to energy performance certificates introduced by the new Decent Homes Standard, many landlords have decided to cut their losses, Sidki added.
“The changes being introduced by The Renters’ Rights Act this Friday mean it will take longer and cost more for a landlord to regain possession of a rental property.
“This reduced flexibility is causing many landlords to rethink their investment strategies, especially as other factors mean they are facing reduced – and even negative cashflow – while also facing increased admin and responsibilities.
“Many portfolios are no longer commercially viable due to landlords losing the ability to deduct full mortgage interest from rental income (under Section 24 of the Finance Act) and the introduction of an additional 2% tax on income from property by Rachel Reeves in her November 2025 budget.
“Additionally, fixed-rate buy-to-let mortgages of 1-2% are coming to an end this year, with new re-finance rates of 5-6% being offered, while the costs of maintaining properties, insurance premiums and local authority licensing fees have all risen this year due to inflation.
“For flat owners, service charges are also going up a lot due to inflation. Whilst service charges can be challenged, freeholders are saying that their own costs are increasing and thus the increases would be deemed reasonable.
“On top of this, landlords now have additional admin with the requirement of quarterly income returns introduced under Making Tax Digital at the beginning of this month.
“With many landlords facing costly upgrades to bring their properties up to EPC C by 2030 under the Decent Homes Standard 2026, many of them are saying the finances simply no longer add up and are rushing to beat the legislation to be able to divest their portfolios.”
