By Expert insight into how HMO landlords can prepare for the Renters’ Rights Act. Get your questions answered & practical advice.
Unless you’ve been hiding under a rock, you’ll know that the Renters’ Rights Act has now gone through Royal Assent, which means that landlords must start getting their ducks in a row to ensure compliance.
The Renters’ Right Act has different implications depending on your property portfolio and how you operate your rental business. For HMO landlords, this legislation brings new challenges and responsibilities, emphasising the need to align management practices with updated legal requirements.
Understanding the specific provisions of the Act and how they apply to Houses in Multiple Occupation is essential for navigating these changes effectively and avoiding fines.
In this feature, we take a look at what the Renters’ Rights Act will mean for HMO landlords, and we’ll get expert insights into how to tackle some of the challenges head-on.
Free 3-Part Renters’ Rights Act Training Now Available
Although the timeframe has yet to be announced, it is never too early to start preparing your portfolio. All three sessions from the National Landlord Investment Show’s free training covering ‘What the New Assured Tenancy System Means in Practice’ with Suzanne Smith, ‘How Evictions Will Change’ with David Smith, and ‘New Landlord Obligation and Penalties, Implementation and Preparation’ with Susie Crolla are now available online.
This exclusive content is only available to the LIS Community, so join for free today to watch all three parts at your own pace and gain the knowledge you need to stay ahead of the upcoming changes.
Impact of the Renter’s Rights Act on HMO Landlords
The Renters’ Rights Act introduces several adjustments that directly influence the management of HMO properties.
With the move toward periodic tenancies, where the replacement of Assured Shorthold Tenancies (AST) with the new Assured Periodic Tenancy (APT) from the implementation date means landlords may face increased administrative demands.
Switching to rolling contracts from fixed-term leases, as mandated by the Act, offers tenants more flexibility. Still, for those operating student accommodation, it could risk disrupting the established academic rental cycle common to HMOs. Landlords may need to look at their business model to maintain the flexibility offered by APTs and to potentially accommodate higher tenant turnover.
For HMO landlords, this change could also impact rental income stability, which may require a more risk-adverse financial planning to address potential fluctuations.
Adapting to the evolving regulatory environment will require landlords to take a more proactive approach in managing their properties, whether they manage them themselves or use an agent.
The Abolition of Section 21 ‘No-Fault’ Evictions
Under the Renters’ Rights Act, to improve tenant security, landlords will only be able to end tenancies under valid Section 8 grounds. Using any other method to end a tenancy may result in substantial penalties.
The nature of HMOs means that this change could have more of an impact on HMOs and the living standards of tenants when compared to more traditional residential lets.
Addressing the specific concerns of landlords managing these properties, Allison Thompson from LRG explains: “The Renters’ Rights Act represents a significant shift for HMO landlords, and it’s understandable that many are feeling uncertain about how the changes will work in practice. The loss of Section 21 has raised real concerns about being unable to remove a disruptive or unsuitable tenant, but landlords should take confidence from the strengthened Section 8 grounds now in place.
“The revised framework provides clearer routes for regaining possession in legitimate circumstances such as persistent rent arrears, antisocial behaviour, property damage or breach of tenancy. There is also a new ground allowing landlords to recover possession if they genuinely intend to sell. These grounds are intended to strike a balance between protecting tenants from unfair eviction and ensuring landlords can still manage their properties effectively. What will matter most is evidence: accurate records of rent payments, inspection notes, complaints and communication will all support a stronger case if possession becomes necessary.
“The new 12-month restriction on re-letting after serving notice to sell does create challenges for HMOs, where tenant turnover is typically higher. Our advice is to plan ahead, review your business model, allow for longer notice periods and ensure any decision to sell is backed by clear evidence of genuine intention. Professional planning and documentation will protect you from unnecessary loss of income. Selling an HMO with tenants in situ remains very common in the investment market, and the principles of good compliance have never been more important. Make sure every tenancy agreement is up to date and of the right standard (the NRLA offer reliable templates), and confirm that all Right to Rent checks have been completed and documented. Buyers will expect to see deposit protection certificates, gas and electrical safety records, a valid HMO licence and fire safety documentation. If you are looking to sell, it is important to work with an estate agent who understands HMOs and regularly deals with this type of property, as they are more likely to have investors actively seeking properties to take on as going concerns.
“Above all, these reforms underline the importance of preparation and professionalism. With good records, clear processes and a proactive approach, HMO landlords can continue to operate successfully and profitably in the new regulatory landscape.”
Time to Take Action
For HMO landlords, now is the time to prepare for the changes introduced by the Renters’ Rights Act, HMO landlords should conduct a thorough review of their operational practices.
With hefty fines in place for non-compliance, taking action now to improve property standards and conduct necessary upgrades is important. Keeping a paper trail and documenting all updates, changes, and communication with tenants is also essential for HMO landlords to ensure they have evidence should any disputes be raised.
To prepare for the introduction of the Act, HMO landlords may also benefit from implementing digital tools to streamline record-keeping and tenancy management, reducing the risk of administrative errors.
Don’t navigate this complex regulatory shift alone. Join the LIS community to access valuable landlord resources, or speak to an expert from the LRG team today. Their expert property services can provide the guidance and support you need to ensure your HMO portfolio meets all the new Renters’ Rights Act requirements with confidence.
If you’re looking for additional resources, a full breakdown of the Renters’ Rights Act, visit the official GOV.UK site. You can also review this detailed article, which specifically breaks down the changes for HMO and student lets.
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