Landlords

Legislation

Landlord Essentials

mini-wesminster

<h2 class='intro_basic'>After two years of planning, we now know that the first stage of the Renter’s Rights Act will come into effect on 1 May 2026.  

<p>Here, Gareth Atkins, Managing Director - Lettings, and Fran Giltinan, Managing Director - Property Management run through the key points to note and discuss how to be prepared as a landlord:

<h3>&#x1f3ac; Watch: Latest Renters' Rights Act news</h3>
 

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<h3>Phase 1 of the Renter’ Rights Act – effective from 1 May 2026
<p style="margin-left: 25px">•	Fixed terms tenancies will be abolished and will be replaced by rolling periodic contracts 
<p style="margin-left: 25px">•	An end to accepting offers over asking price 
<p style="margin-left: 25px">•	Clearer language on tenant discrimination and pets in tenancy
<p style="margin-left: 25px">•	Annual rent reviews under Section 13
<p style="margin-left: 25px">•	The end of Section 21 ‘no fault’ evictions and strengthened grounds for possession through Section 8

<h3>Phase 2 of the Renter’ Rights Act – effective from late 2026
<p style="margin-left: 25px">•	A new landlord database of property compliance
<p style="margin-left: 25px">•	A new Ombudsman to escalate tenancy issues

<h3>Phase 3 of the Renter’ Rights Act – effective date yet to be clarified by the government
<p style="margin-left: 25px">•Decent Homes Standards and Awaab’s Law applicable to the private rented sector, dealing with the repair obligations, most notably mould

<p>At the same time as confirming the effective date, the Government has published guidance documents <b><a href='https://www.gov.uk/government/organisations/ministry-of-housing-communities-local-government' target='_blank'>guidance documents</a></b>, with more specific guidance still to be released at a later date. Foxtons will be scrutinising these and all future releases from the Government, which underline the value of a Property Management relationship with Foxtons now more than ever. 

<p>When we manage your property we will find the right tenant, achieve the right price for your property and manage your asset to make sure it delivers a good return on your investment as well as remaining compliant. You can find out more about Foxtons Property Management and Rent Protection using the following link:
 

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<a href="https://www.foxtons.co.uk/landlord/enquiry/property-management" class="cta-button cta-button-primary">Foxtons Property Management</a></center> 

landlord-license

<h2 class='intro_basic'>Chancellor of the Exchequer, Rachel Reeves, was recently found to have let her Dulwich home without having secured the necessary selective licence from the London Borough of Southwark. This came only a few weeks after former Deputy Prime Minister, Angela Rayner, resigned having failed to pay the correct level of stamp duty when purchasing a flat. This makes one thing is very clear, it is more important than ever to get expert advice when navigating the complex regulatory systems in UK residential property.

<h3>What licenses do you need?
 
<p>Ms Reeves is certainly not alone in finding the UK residential property processes a little difficult to understand. There are 38 London boroughs and each has its own licensing scheme that imposes its own particular licensing conditions, with many operating more than one scheme. 

<p>Different rules apply for different types of letting: 
<p style="margin-left: 25px">•‘mandatory’ houses in multiple occupation (those with five or more occupants forming two or more households) are caught by one set of rules
<p style="margin-left: 25px">•smaller HMOs (still two households but perhaps only three occupants) are caught by ‘additional’ licensing rules. 
<p style="margin-left: 25px">•properties that are not HMOs, but are located in zones designated by local authorities, come under ‘selective’ licensing schemes

<p>All of this makes for a complex picture for London’s landlords. 

<h3>We get it done, so you don’t have to

<p>Foxtons property management keeps you ahead of compliance requirements: 
<p style="margin-left: 25px">•we uses specialist technology that tracks, on an ongoing basis, emerging licensing schemes
<p style="margin-left: 25px">•	our teams are trained to read, understand and explain to landlords the level of works they need to do to comply with licence conditions
<p style="margin-left: 25px">•our inspection teams are training to conduct a higher level of inspections for licensed properties
<p style="margin-left: 25px">•we track our 24 hour response times in resolving maintenance issues with increased vigilance for Iicensed properties.

The regulatory landscape is unlikely to get simpler, any time soon and the penalties for ‘inadvertent mistakes’ are severe. Renting a property without the necessary licence is a criminal offence, punishable by a fine of up to £30K or, on prosecution, an unlimited fine. On top of that, tenants can apply for refunds of up to twelve months’ rent for the period for which the property remained unlicensed (called ‘rent repayment orders’).

<p>So don’t trust just any agent with your property, choose the UK’s largest lettings agent* and the peace of mind in knowing that we get it done, so you don’t have to. 

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<a href="https://www.foxtons.co.uk/landlord/property-management">Find out more</a>


<p>*TwentyCI data, 2024 new lettings instructions at an estate agent brand level


Renting

Property market updates

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<h2 class='intro_basic'>September saw a seasonal slowdown in applicant demand, with 32% fewer registrations month-on-month. However, rental values remained strong, with average rents reaching nearly £600 per week, the highest September figure in four years. Increased stock levels and resilient applicant budgets suggest a more balanced market is emerging across London. 

<p>Looking ahead, landlords should prepare for the upcoming Renters’ Rights Act, due to take effect from 2026. Key changes include the end of Section 21 “no-fault” evictions, the introduction of rolling tenancies, and stricter rules around rent increases and property standards. A new national landlord register and compliance framework will also be introduced in a second implementation phase.

<p>Foxtons is actively supporting landlords through these changes, ensuring properties remain compliant and well-managed. If you have questions about how the reforms may affect your portfolio, our team is here to help.

<br>
<p><center><p style="background-color: #cce3e0;"><a href='https://cms-assets.foxtons.co.uk/Foxtons_Lettings_Market_Report_September_2025_customer_27f43ebcee.pdf' target='_blank'>See the full story in the <b>Lettings Market Report - September 2025</b></a></big></center>


westminter-bud

<h2 class='intro_basic'>By this point, just about everyone had expected the Renters' Rights Bill to have become law. In this blog we look at what’s happened and where we are now. We’ll also look at the next steps and the likely timeframe within which it actually will become law. 

<p>We’re now in a phase called ‘ping-pong’, a colloquial name given to the last stages of a bill's passage before it becomes law. During this phase of a bill’s passage, the two Houses (Commons and Lords) bounce the bill to each other, exchange debate and see if they can agree on the text and various amendments that, during the previous stages of the bill’s passage through parliament, each has suggested be made to the wording of the bill.  

<p>The first round of ping-pong took place on September 8 when the Commons rejected just about all of the amendments as had been proposed by the Lords. The next round of this process will see the bill being returned to the Lords for consideration of those rejections. 

<p>Exactly when that will happen is uncertain and depends on the Lords’ diary. Parliamentary diaries and schedules are always busy with a multitude of competing laws and debates all vying for time. 

<p>We do know that both the House of Commons and the House of Lords are currently in recess (the Commons for the party conference season). Each House returns on 13 October so we can probably expect to see a date in the Lords’ diary fairly shortly after that.  

<p>At that point, the Lords must decide whether to oppose the Commons’ rejections or concede to them. Conceding will mean that the contents of the bill are agreed, which, by definition, means no more debate is necessary and the bill will then be handed back to the Commons for Royal Assent, the stage at which the bill is declared law and becomes what will be known as the Renters’ Rights Act 2025. Barring any further delays, that seems likely to happen in the second half of October or perhaps early November. 

<p>Of course, that is not the complete picture. Just because a bill becomes law, does not mean it comes into effect immediately. Each new bill contains what is known as a ‘commencement date', which is the date on which it actually comes into force. The reason for delayed implementation is to give notice to those affected by the new law so they can prepare. The Government is on record as saying that it will provide sufficient time in which to allow a smooth transition from the old law to the new. Quite how long they consider is necessary to enable this is uncertain, with estimates ranging from three months (January 2026) to six months (April 2026).  

<p>As the bill receives Royal Assent and the Government issues further guidance before the commencement date, we will keep you informed of developments.</p>

Foxtons news

rental-properties-east-london

<h3 class='intro_basic'>July's London Lettings Market update and the latest Renters' Rights Bill news</h2>

<p>July saw London’s rental market surge, with demand climbing 23% month-on-month. New renters per instruction grew 18% month-on-month and there was almost 50,000 new listings, indicating a competitive market, in which there was a 2% rise in average weekly rents to £605, just shy of the 2023 market peak. 

<p>Renter budgets continued their gradual upward trajectory to £554 per week, 2% higher than the same period in 2024. The current market offers balance to tenants and landlords with more choice and stable returns.

<p>With the Renters Rights Bill expected to come into effect in 2026, landlords should begin preparing for the expected changes. At Foxtons, we’re here to help landlords navigate these shifts and make the most of a dynamic market.

<h3>&#x1f3ac; Watch: Latest Renters' Rights Bill news</h3>
<p>Fran Giltinan, Managing Director - Property Management and Customer Experience , shares her expert opinion on what's ahead: 

<center><div style="padding:177.78% 0 0 0;position:relative;"><iframe src="https://player.vimeo.com/video/1111583083?h=5bacf74a6b&amp;badge=0&amp;autopause=0&amp;player_id=0&amp;app_id=58479" frameborder="0" allow="autoplay; fullscreen; picture-in-picture; clipboard-write; encrypted-media; web-share" referrerpolicy="strict-origin-when-cross-origin" style="position:absolute;top:0;left:0;width:100%;height:100%;" title="Lettings Market Report - July"></iframe></div><script src="https://player.vimeo.com/api/player.js"></script></center>

<p>Check out our full <a href='https://cms-assets.foxtons.co.uk/Lettings_Market_Stats_Company_Level_Customer_ef67a6c87b.pdf' target='_blank'>Lettings Market Report</a> for June 2025. 


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<p>Having completed its journey through the House of Lords, the Renters Rights Bill returns to the Commons on September 8 for consideration of the Lords’ amendments. This process, aptly named ‘ping-pong’, will see the Bill bounce back and forth between the two Houses until all amendments have either been agreed, or voted down by the majority Commons.</p>

<p>Once this process is complete, the Bill will receive ‘Royal Assent’, the process by which it becomes law. However, the date on which the new law will actually take effect (known as ‘the ‘commencement date’) is expected to be some time later. The Government is on record as saying that a full suite of guidance will be published so that landlords, agents and other interested parties can prepare adequately for implementation. There is no firm indication of when the commencement date will be  but it is likely to be somewhere between two and six months after Royal Assent. Practically speaking, this means it could happen in December (though that is more likely to mean January 2026 due to Parliament’s opening times), or April 2026. Even so, some aspects of the Bill will come into effect after the commencement date, so expect ‘waves’ of implementation.</p>

<p>People will always need somewhere to live, and we expect no let-up in tenant demand so here are some <b>tips to help you prepare</b> to protect your investment:</p>

<p><p style= "margin-left: 25px"><b>1</b> Condition and disrepair of property is at the heart of the new legislation. Landlords would be wise to ensure their properties meet safety and compliance standards and that any damage or other issues at the property that could negatively impact the health and safety of tenants are identified and professionally rectified. Landlords should consider professional property management. Foxtons property management will remove these compliance burdens and ensure that detailed records of repairs and issues are maintained.  
<p><p style= "margin-left: 25px"><b>2</b> Be aware that fixed term tenancies will be abolished overnight. There will be no end-date to tenancies. Make sure your tenancy agreement complies with the new requirements. Foxtons tenancy agreements will ensure you stay on the right side of the law.
<p><p style= "margin-left: 25px"><b>3</b> Understand the new grounds for possession. Section 21 no fault evictions are being abolished. That means no longer will you be able to recover possession without a supporting ground. Possession claims will need to be based on the correct legal forms and be heard by a judge. Foxtons’ network includes legal specialists in possession law who can help you navigate the legal maze should you need to.
<p><p style= "margin-left: 25px"><b>4</b> Consider rent and legal protection to protect your income stream in the event either that your tenant falls into arrears, or you need to take possession action.

<p>As the Government issues further guidance before implementation and phases in some parts of the Law, we will keep you informed of developments.</p>

london-big-ben

<h2 class='intro_basic'>Considering an HMO? There's a lot to think about, especially when it comes to compliance. Foxtons Director of Legal and Compliance, Manjit Kataora, summarises it for you in the following article: </h2>

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  <h5><big>Key takeaways</big></h5>
  <p class="takeaways-subtitle">Click a number to jump to that topic in the article.</p>
  
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       <li class="takeaway-item">
      <a href="#section1" class="jump-link"><span class="takeaway-item-number">1</span></a>
      <span class="takeaway-item-highlight">Local rules apply. </span>
      <span class="takeaway-item-content"> Each London borough has its own specific HMO licensing rules you must follow.
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    </li> 

<li class="takeaway-item"><a href="#section2" class="jump-link"><span class="takeaway-item-number">2</span></a>
      <span class="takeaway-item-highlight">Budget for compliance.</span>
      <span class="takeaway-item-content"> Contact your local council early to understand potential costs for safety upgrades.</span>
    </li>
    
    <li class="takeaway-item">
      <a href="#section3" class="jump-link"><span class="takeaway-item-number">3</span></a>
      <span class="takeaway-item-highlight">Applying promptly matters.</span>
      <span class="takeaway-item-content">While a pending application is a defence, don't risk operating without a full licence.</span>
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    <li class="takeaway-item">
      <a href="#section4" class="jump-link"><span class="takeaway-item-number">4</span></a>
      <span class="takeaway-item-highlight">Managers are liable too.</span>
      <span class="takeaway-item-content"> If you collect rent, you share responsibility for HMO licensing compliance.</span>
    </li>


    <li class="takeaway-item">
      <a href="#section5" class="jump-link"><span class="takeaway-item-number">5</span></a>
      <span class="takeaway-item-highlight">Compliance protects your income.</span>
      <span class="takeaway-item-content">Breaching HMO rules can lead to hefty fines and rent repayment.
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<a id="section1"></a>
<p>Each of London’s 32 boroughs operates its own set of licensing conditions governing safety standards of HMOs within their designated area. Though each borough imposes its own individual conditions (meaning there’s no single set of conditions that govern all HMOs), most HMO licences are broadly similar in terms of the obligations they impose on the landlord (or manager). 

<a id="section2"></a>

<p>Invariably, they will contain a condition to place a notice in a prominent area of the property (usually a common part, e.g. the kitchen) informing the occupants of the landlord or property manager’s identity and contact details e.g. in the event of a disrepair issue, or emergency. Other conditions typically include specific fire safety systems (including the grade of alarm system); fire doors; intumescent strips; escape routes, and other safety-related details such as the number of sockets (so as not to overload wiring circuits). What this means for landlords considering setting up HMOs is that they would be well-advised to contact their local authorities for sample licence conditions and cost the likely outlay these works will require so that they can budget accordingly, and so that they can decide whether such works are even compatible with their property. 


<a id="section3"></a>
<p>The quirks of local authority licensing procedure means that it is a defence against having no licence provided an application has been submitted and is pending. That, however, is not a defence on which it is wise to rely. This is because in the event the application is refused, a landlord who had by then set up an HMO, would be guilty of an offence. Even where a licence is granted, the conditions might require invasive (not to mention expensive) works to the property that require the decanting of tenants to alternative accommodation, hence might be unworkable in practice for single property landlords. The refusal of a licence leaves such landlords open to the offence of operating an HMO without a licence and brings them within scope of a fine. Fines are usually issued by fixed penalty notices of up to £30,000, although local authorities can choose to prosecute and where they do this the fines can be unlimited. Penalties can be publicised, and an entry can be made on the rogue landlords (and agents) database. 

<p>Where a local authority suspects a breach of licensing law, there are a few tools in their armoury they can use to prove an offence. Among these are written requests for information. These have the same weight and effect as a police interview; they are issued under caution. Councils can also choose to visit the property and take evidence from the occupants as to living arrangements, at which time they’re also likely to inspect the property to see whether it actually complies with the appropriate licensing conditions. Suspected breaches will be itemised and documented, the date of the inspection recorded, and where the local authority is satisfied an offence has been committed (to the criminal standard of proof, i.e. beyond reasonable doubt) their enforcement department will issue a notice of fine. 

<p>The only defence against a fine is that of ‘reasonable excuse’. There is no single definition of what constitutes a reasonable excuse, whether it can be established usually means looking at the particular facts of any given case and trawling through previous case history and/or getting (specialist) legal advice. The facts may be obvious; for example, the property was not in fact being used as an HMO at the time, or that the property was unlawfully (and without the landlord or manager knowing) sub-let to multiple occupants by a non-HMO tenant such that licensing conditions were then engaged. Where a defence is established, it will mean the HMO offence has not in fact been committed and no fine can be imposed. 

<p>The licensing regime doesn’t apply to all HMOs but only certain HMOs that are subject what’s called the mandatory licensing regime. This covers three specific types of HMO: (i) Those meeting the ‘standard test’ (at least two households sharing a basic amenity); (ii) self-contained flats that are not purpose-built (occupied by 5 or more people forming one or more household); and (iii) HMOs in converted buildings – essentially buildings originally constructed for single use but which have been converted into separate living accommodation, - e.g. bedsits.  Where the HMO meets these tests, it will require a licence. 

<p>Not all HMOs, however, meet these tests. Those that do not meet the test remain subject to the Licensing and Management of Houses in Multiple Occupation (Additional Provisions) (England) Regulations 2007. These regulations impose requirements which in practical terms are not wholly dissimilar to most local authority licensing conditions. Concerned with the same issues, fire safety, means of escape, etc. a landlord whose HMO is not within scope of the licensing regime can still be fined for breaching these regulations. 

<a id="section4"></a>
<p>Regardless of which regime is breached, penalties don’t just fix against the landlord. The property manager can also be held liable alongside the landlord. The term ‘property manager’ means whoever collects the rent, even where this is on behalf of the landlord. There are some circumstances where a property manager may not be held liable for a licensing breach however, this involves technical (and legal) points outside the scope of this blog and independent advice should be sought. 

<p>What this means in practice is that landlords and agents must be aware of the licensing regime, and the regulations. This will necessarily involve a lot of work in checking conditions, and that works required by those conditions have been undertaken (licence conditions usually impose time limits by which recommended works must be completed and may refuse to renew licenses where works have not been done in time or at all). Landlords and agents will also need to ensure – and be able to prove – that they have kept on top of inspections so that condition of the property is kept in check, alarm systems are tested, and that escape routes remain clear and unblocked, etc. 

<p>Regular inspections can be used to demonstrate where required, that you are on top of your HMO and any issues that arises can be dealt with by reference to a system of checking as opposed to there being no such system in place at all that ensures the safety of occupants, which is when enforcement action is particularly liable to follow.  

<a id="section5"></a>
<p>Any landlord found to have breached HMO requirements is also liable to repay their tenants the rent under what is known as a rent repayment order. Here, tenants can apply to the relevant tribunal for reimbursement of up to 12 months’ rent provided they do so within 12 months of the last date on which the offence was committed. 

<p>HMOs then, are not to be treated as ordinary lets. They are much more complex and attract significant fines for non-compliance. The rewards are there – not only in terms of yield but in providing housing accommodation for those who otherwise may be unable to access the property market. Good preparation, and management, is the key. 

<hr>
<h3>Need some help setting up your HMO?</h3>
<p>Good news, Foxtons Property Management have a team of experts ready to walk you through your HMO requirements and get your property up to speed with compliance.
<P style="margin-left: 25px"><big>We get it done, so you don't have to. </big>
<P style="margin-left: 25px"><a href='https://www.foxtons.co.uk/landlord/property-management' target='_blank'>Explore Foxtons Property Management</a>

<hr>
<P><b><a href='https://www.foxtons.co.uk/discover/news/landlord-essentials' target='_blank'>Landlord Essentials</a></b> is a series of articles where our experts delve into the big questions for London landlords. If you have a question on letting your property in London, or you want help making your property a success, get in touch with <a href='https://www.foxtons.co.uk/landlord' target='_blank'>Foxtons lettings team</a>.


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   <p><p><b>Source:</b> This piece was authored by Foxtons Director – Legal & Compliance, Manjit Kataora, who has been working with Foxtons on the intricacies of legislation affecting London landlords for more than 16 years. If you have a question on the article, <a href='mailto:experts@foxtons.co.uk?subject=Foxtons%20HMO%20Article' target='_blank'>ask a Foxtons expert</a>.</div>


landlord-essentials-epc

<h2 class='intro_basic'>Here's an update for London landlords on the government's plans and proposals around EPC, by Foxtons Director of Legal & Compliance, Manjit Kataora.</h2>

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  <h5><big>Key takeaways</big></h5>
  <p class="takeaways-subtitle">Click a number to jump to that topic in the article.</p>
  
  <ul class="takeaways-list">
    
       <li class="takeaway-item">
      <a href="#section1" class="jump-link"><span class="takeaway-item-number">1</span></a>
      <span class="takeaway-item-highlight">EPCs may be changing. </span>
      <span class="takeaway-item-content">The government is considering reforms to how Energy Performance Certificates are calculated and displayed.</span>
    </li> 
       <li class="takeaway-item">
      <a href="#section2" class="jump-link"><span class="takeaway-item-number">2</span></a>
      <span class="takeaway-item-highlight">New metrics coming. </span>
      <span class="takeaway-item-content">EPCs may include more detailed information like 'fabric performance,' 'heating system efficiency,' and 'smart readiness' to give a clearer picture of energy use.</span>
    </li> 
 <li class="takeaway-item">
      <a href="#section3" class="jump-link"><span class="takeaway-item-number">3</span></a>
      <span class="takeaway-item-highlight">Considering the timeline. </span>
      <span class="takeaway-item-content">These aren't yet firm plans but proposals.</span>
    </li> 
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<p>In February this year, the Government closed its consultation into reforms to the Energy Performance of Buildings regime. The consultation is a major step towards the government’s overall net zero agenda: to achieve net-zero emissions nationally by the year 2050. 

<a id="section1"></a>
<p>One the key elements in the report was the reform of Energy Performance Certificates regime. 

<p>The law on Energy Performance Certificates is contained in the Energy Performance of Buildings (England and Wales) Regulations 2012 (“EPC Regulations”). EPCs are the primary accepted means of rating the energy performance of a building. Ratings (from A to G) assess the energy efficiency of a given building, in theory allowing anyone renting or buying a property to gauge whether that building will cost more or less to run than an equivalent alternative property.  

<p>The problem is that these ratings are based on standardised heating patterns, temperatures and fixed fuel price assumptions hence they are (or can easily become) outdated and therefore not (always) accurate. To take a simple example, a heat pump (usually regarded as an efficient means of heating a home compared to gas) that replaces a gas central-heating system, might on the surface suggest an improvement in the cost efficiency of a given home. But price fluctuations in the cost of electricity compared to gas might mean that the heat pump is actually more expensive (this is the same issue as one hears more often nowadays about the cost of running an electric car vs an internal combustion engine vehicle).

<a id="section2"></a>  

<p>To address this, the government proposes a range of additional metrics that would go to make up a more detailed (and accurate) picture of the energy efficiency of a building. It proposes that domestic EPCs use four main ‘headline’ metrics. These are ‘fabric performance’ (thermal properties of the construction) ,‘heating system’ (ranking different heating systems based on technology and type) ‘smart readiness’ (smart meters; solar panels, etc) and ‘energy cost’ (the predicted energy consumed by the building) Other secondary metrics would add to the picture. Combined, all of them would allow a consumer to assess more accurately how efficient a home was overall. 

<p>The answer to why any of this matters at all is that, based on the government statistics, buildings account for about 20% of the UK’s total greenhouse gas emissions. Improving the thermal efficiency of buildings, therefore, represents a major part of the journey toward net-zero. 

<p>What the government then has to do is settle on a way of displaying these metrics in an easy-to-understand way that makes sense to consumers without confusing them. 

<a id="section3"></a>
<p>Currently, the aim is to introduce changes to EPC metrics in the second half of 2026 and the consultation also explores the proposal to reduce the lifespan of an EPC (currently 10 years and only legally required to be renewed when the property is let or sold). 

<p>These aren’t firm plans but proposals. Consultations require engagement by stakeholders (interested groups within society). The government is now busy considering responses to the consultation and we can but wait and see where these will land, or whether these plans will succumb to another rapidly evolving climate change – namely the macroeconomic one.

<p>A copy of the consultation can be accessed <a href='https://www.gov.uk/government/consultations/reforms-to-the-energy-performance-of-buildings-regime/reforms-to-the-energy-performance-of-buildings-regime#air-conditioning-inspection-reports' target='_blank'>here</a>.   

<hr>
<P><b><a href='https://www.foxtons.co.uk/discover/news/landlord-essentials' target='_blank'>Landlord Essentials</a></b> is a series of articles where our experts delve into the big questions for London landlords. If you have a question on letting your property in London, or you want help making your property a success, get in touch with <a href='https://www.foxtons.co.uk/landlord' target='_blank'>Foxtons lettings team</a>.


<br><hr><br>
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   <p><p><b>Source:</b> This piece was authored by Foxtons Director – Legal & Compliance, Manjit Kataora, who has been working with Foxtons on the intricacies of legislation affecting London landlords for more than 16 years. If you have a question on the article, <a href='mailto:experts@foxtons.co.uk?subject=Foxtons%20EPC%20Article' target='_blank'>ask a Foxtons expert</a>.</div>

making-tax-digital-initiative

<h2 class='intro_basic'>There is a tax initiative coming that landlords should be aware of. What do you need to know? Manjit Kataora, Foxtons Director - Legal & Compliance, summarises the 'Making Tax Digital' initiative below:</h2>

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  <h5><big>Key takeaways</big></h5>
  <p class="takeaways-subtitle">Click a number to jump to that topic in the article.</p>
  
  <ul class="takeaways-list">
    
       <li class="takeaway-item">
      <a href="#section1" class="jump-link"><span class="takeaway-item-number">1</span></a>
      <span class="takeaway-item-highlight">Digital tax ahead. </span>
      <span class="takeaway-item-content">The government is implementing 'Making Tax Digital,' requiring landlords to submit tax information digitally.</span>
    </li> 

<li class="takeaway-item"><a href="#section2" class="jump-link"><span class="takeaway-item-number">2</span></a>
      <span class="takeaway-item-highlight">Income thresholds matter.</span>
      <span class="takeaway-item-content">Your qualifying income determines when you'll need to comply, with higher earners needing to prepare first.</span>
    </li>
    
    <li class="takeaway-item">
      <a href="#section3" class="jump-link"><span class="takeaway-item-number">3</span></a>
      <span class="takeaway-item-highlight">Software is available.</span>
      <span class="takeaway-item-content">You'll need to use specialist accounting software to meet the new digital reporting requirements.</span>
    </li>

    <li class="takeaway-item">
      <a href="#section4" class="jump-link"><span class="takeaway-item-number">4</span></a>
      <span class="takeaway-item-highlight">Preparing early is beneficial.</span>
      <span class="takeaway-item-content">Start looking into MTD software and processes now to avoid last-minute stress and ensure a smooth transition.
</span>
    </li>
  </ul>
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<p>The Government has recently reminded landlords with qualifying income over £50,000 to start preparing to digitalise their annual return process. 

<a id="section1"></a><p>The making tax digital (MTD) initiative was first announced by the UK government in 2015. The stated aim of MTD was to simplify the annual income self-assessment return process for landlords. The term ‘simplify’ refers to the digitisation of the process (achieved through the use of specialist landlord software accounting packages) and not to the frequency of returns because whereas the current return process only requires an annual return, MTD requires quarterly returns plus an end of year return, increasing the level of reporting actually required. 

<p>MTD first required that landlords with a qualifying income of over £10,000 – by far the vast majority of landlords - would need to comply with MTD by 2024. Pressure by landlord groups led to a postponement of the implementation timescale as well as a re-assessment of the income thresholds at which MTD would apply. The term ‘qualifying income’ includes gross income from self-employment and property, i.e. before tax allowances or expenses are deduced.


<a id="section2"></a>
<p>For landlords with a qualifying income of over £50,000, MTD now goes live on 6 April 2026. Quarterly reporting means that landlords are reporting in near-real time, and the ability to keep electronic records, means - in theory at least – that landlords can spend less time collating end-of-year figures from piles of paper collected from as far back as 21 months beforehand (assuming the tax return is filed just before the 31 January deadline). Landlords in this category should now be looking at MTD software and it’s advisable they adopt the process beforehand to avoid any last-minute rush or glitches. 

<p>Those landlords whose qualifying income above £30,000 have until April 2027 to comply and, from April 2028, landlords with qualifying income over £20,000 will also have to adopt MTD. 

<a id="section3"></a>
<p>A range of commercial software solutions already exist and they are set out helpfully in Government’s guidance accessible <a href='https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax' target='_blank'>here</a>.  These include ‘bridging’ software packages  that, as the name suggests, allows you to connect your existing spreadsheet records or accounting software to software that works with MTD. 

<p>It’s important to review these options based on your needs because while some packages will allow you to send quarterly updates and submit your annual tax return, others will not; the logic being that landlords who rely on accountants to send the annual return might still want their accountant to do this for them, but might be comfortable sending quarterly updates themselves. Expect more packages to come to market in the run up to April 2026. 

<a id="section4"></a>
<p>MTD is now on its way. It’s unlikely to be postponed again. The implementation timetable is phased so as to allow plenty of time to get to grips with the new process allowing landlords to choose the option that best meets their needs. 

<hr>
<P><b><a href='https://www.foxtons.co.uk/discover/news/landlord-essentials' target='_blank'>Landlord Essentials</a></b> is a series of articles where our experts delve into the big questions for London landlords. If you have a question on letting your property in London, or you want help making your property a success, get in touch with <a href='https://www.foxtons.co.uk/landlord' target='_blank'>Foxtons lettings team</a>.


<br><hr><br>
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   <p><p><b>Source:</b> This piece was authored by Foxtons Director – Legal & Compliance, Manjit Kataora, who has been working with Foxtons on the intricacies of legislation affecting London landlords for more than 16 years. If you have a question on the article, <a href='mailto:experts@foxtons.co.uk?subject=Foxtons%20Tax%20Article' target='_blank'>ask a Foxtons expert</a>.</div>

data-protection

<h2 class='intro_basic'>Do you, as a landlord, need to register with the Information Commissioner's Office to deal with your tenant's data? Well, it depends on who's actually managing the data. In the article below, Foxtons Director of Legal & Compliance, Manjit Kataora, will explain what you need to know about data protection. </h2>


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  <h5><big>Key Takeaways</big></h5>
  <p class="takeaways-subtitle">Click a number to jump to that topic in the article.</p>
  
  <ul class="takeaways-list">
    <li class="takeaway-item">
      <a href="#section1" class="jump-link"><span class="takeaway-item-number">1</span></a>
      <span class="takeaway-item-highlight">Handling personal data legally.</span>
      <span class="takeaway-item-content"> To process large amounts of personal information, agents must register with the Information Commissioner's Office (ICO).</span>
    </li>
    
    <li class="takeaway-item">
      <a href="#section2" class="jump-link"><span class="takeaway-item-number">2</span></a>
      <span class="takeaway-item-highlight">Unregistered agent? Could be a red flag.</span>
      <span class="takeaway-item-content">It's worthwhile to confirm your agent is ICO-registered and dealing with your personal information appropriately.</span>
    </li>
    
    <li class="takeaway-item">
      <a href="#section3" class="jump-link"><span class="takeaway-item-number">3</span></a>
      <span class="takeaway-item-highlight">If you use a managing agent...</span>
      <span class="takeaway-item-content"> If you simply receive rental statements from us without handling tenant data directly, you likely fall under the 'accounts and records exemption,' so might not need to register.</span>
    </li>

    
    <li class="takeaway-item">
      <a href="#section4" class="jump-link"><span class="takeaway-item-number">4</span></a>
      <span class="takeaway-item-highlight">Self-managing? You may need to register.</span>
      <span class="takeaway-item-content"> Landlords who manage properties themselves or maintain their own tenant filing systems will likely need to register as data controllers and comply with data protection regulations.</span>
    </li>

    <li class="takeaway-item">
      <a href="#section4" class="jump-link"><span class="takeaway-item-number">5</span></a>
      <span class="takeaway-item-highlight">It could be that simple.</span>
      <span class="takeaway-item-content"> Our systems are already set up for data protection compliance, saving you time, money, and potential legal complications.</span>
    </li>
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<a id="section1"></a>

<P>Data Protection legislation is nothing new. But it came into fresh focus when, on 25 May 2018, the General Data Protection Regulation came into force. 

<P>In terms of estate and letting agency work, agents will process large amounts of personal data (broadly speaking defined as information that allows you to identify a living individual) belonging to their customers and employees. This means they must be registered as data controllers with the UK regulator the Information Commissioner’s Office (ICO) and must also comply with all that is required under data protection law. Obligations include holding information securely and accurately, and being able to comply with customer data protection requests. Anyone can check whether any organisation that holds their personal data (known as a ‘data controller’) is registered by checking the relevant register on the <a href='https://ico.org.uk/esdwebpages/search' target='_blank'>ICO’s website</a>. 

<a id="section2"></a>
<P>No estate or letting agent should process personal data without first being registered.  Those who do will be in breach of data protection legislation and this should serve as a red flag to any potential customer. After all, if an agent cannot be bothered to understand even their basic data protection obligations, there is a fair risk they are probably non-compliant elsewhere as well. 

<a id="section3"></a>
<P>As for landlords themselves, it is not necessarily the case that they will need to register as data controllers with the ICO. Those who retain a managing agent and do not handle any tenant personal data but merely receive a monthly rental statement from their agent would according to the ICO’s guidance fall under the accounts and records exemption and so need not register. 

<a id="section4"></a>
<P>But landlords who either do not have a managing agent or do have one but choose to create their own ‘structured filing system’ (as the term is known in data protection circles) containing tenant records and background information will more than likely find themselves processing personal data about their tenants and will therefore need to  register with the ICO and comply with all the various (and numerous) obligations and responsibilities that flow from such status.

<P>Even those landlords who manage to avoid processing information about their tenants, may find there comes a point at which it becomes necessary to register because they simply cannot avoid collecting details about their tenant. This might happen after the end of the landlord / tenant relationship where, if for example, the tenant vacated but in arrears, and the landlord now needs certain information from their agent in order to trace them, take proceedings against them or enforce a judgment. Where such information is collected by the landlord they would be well-advised to ensure they are registered with the ICO before processing it. This requirement could still be avoided if all the information is passed directly from the agent to the landlord’s solicitor (who will already be registered as a data controller) and does not pass through the landlord’s control but it means the landlord has to consciously avoid processing any of the information at all, which might be easier said than done. 

<P>There is then, quite an incentive to avoid being caught up in the need to register. The work required to be a competent data controller is something that few landlords are actually aware of (or would want to take on if they were) but the cost of time and money in complying means that it can and does make a managing agent – whose systems are set up for compliance in this area - look like good value, particularly when you consider the various rights tenants have other their personal data, not least subject access rights. The My Foxtons portal affords landlords visibility of tenant information using the Foxtons platform without the need to process personal data themselves.  Even so, there might come a point in the relationship where it is just not possible to avoid processing tenant personal data and to that extent, landlords are well advised to consider, as a precaution, registering with the ICO and taking steps to comply with their obligations. 

<P>More <a href='https://ico.org.uk/rst' target='_blank'>information is available from the ICO</a>. 


<hr>
<a id="section3"></a>
<h3>Your data protection, sorted.</h3>
<p>You don't have to become a registered Data Controller - our ICO-registered and experienced Lettings team will ensure all data is handled correctly and complies with data protection laws. Get started with a rental valuation. Or, if you want help with an existing tenancy, look into Foxtons Property Management.
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<br><hr><br>
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   <p><p><b>Source:</b>  This piece was authored by Foxtons Director – Legal & Compliance, Manjit Kataora, who has been working with Foxtons on the intricacies of legislation affecting London landlords for more than 16 years. If you have a question on letting your property in London, <a href='mailto:experts@foxtons.co.uk?subject=Data%20Protection%20Article%20Landlord%20Essentials' target='_blank'>ask a Foxtons expert</a></div>


london-residential-skyline

<h2 class='intro_basic'>This is an open letter we sent to the Rt Hon Angela Rayner MP, written by Foxtons CEO Guy Gittins. In it, Guy addresses the last-minute addition of a ban on upfront payments in the Renters' Rights Bill. </h2>
<p>As the largest estate agent in the UK,<sup><a href="#source-one">1</a></sup> we handle an incredible amount of tenancies, which gives us a comprehensive, professional perspective on this issue. By sharing our perspective, we aim to explain what this ban could mean for tenants and landlords, and ask the critical question:  <b>how can those who narrowly miss affordability criteria overcome the barriers to housing these changes will create?</b> 



<p><small><a id="source-one"><sup>1</sup></a>Source: TwentyCI data, 2024 new lettings instructions at an estate agent brand level</small>



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   <p><br><br>28 January, 2025
<br><br><br>
<p>Rt Hon Angela Rayner MP
<br>Deputy Prime Minister &
<br>Secretary of State for Housing, Communities 
<br>and Local Government
<br><br>
<p>Cc: Baroness Taylor of Stevenage OBE

<br><br><br>
<p>Dear Deputy Prime Minister, 

<p>I am writing this letter to you in my capacity as Chief Executive Officer of Foxtons Group plc, London's largest lettings agent, to express concern over the late changes tabled during the Renters' Rights Bill's second reading, specifically regarding the <b>banning of upfront rental payments and the lack of a sufficient transition period.</b>

<p>We want to make it clear that we are wholly supportive of your government's efforts, and indeed previous government efforts, to improve living conditions across the entire sector and to ensure the rental market works for everyone. 

<p>But while we support the overarching goals of the proposed legislation, we believe that these amendments will unintentionally harm lower-income tenants, the international student market, hinder upward mobility, and drive talented individuals away from London and the UK. 

<p><b>The problem and the unintended consequences</b>
<p>Landlords typically ask for rent in advance from tenants who struggle to pass traditional affordability checks, such as those with low or unpredictable income, the self-employed, pensioners and foreign tenants who cannot provide a guarantor. Our data highlights the scale of this issue: 10-15% of tenants narrowly fail affordability criteria. 

<p>The impact of removing upfront payments would therefore be most pronounced for lower-income tenants, many of whom currently rely on savings or guarantors to secure housing. These individuals would be left with no viable alternatives, effectively excluding them from the rental market and exacerbating the very issues the reforms seek to solve. 

<p><b>Hindering upward mobility</b>
<p>Restricting access to housing in this way also risks undermining social mobility and deterring people from relocating to cities like London - particularly students and entry-level professionals. This could result in a 'talent drain', leaving London and other major cities struggling to attract and retain the diverse, skilled workforce needed to drive innovation and growth. At a time when economic growth is critical, such a loss of talent could have long-term consequences on local economies. 

<p><b>The landlord impact</b>
<p>These regulations would also have an impact on landlords. Upfront payments help mitigate the risk of missed payments from those tenants who can sustain a tenancy but who are unable to pass referencing and affordability checks - without these upfront payments, landlords are understandably less likely to rent to such tenants. It is impractical and irresponsible to deny landlords any assurance when renting to individuals who cannot easily prove their financial capability. This could exacerbate challenges in an already constrained market and may reduce the supply of rental homes, drive up rent prices, and make affordable housing harder to find.

<p><b>Lack of a sufficient transition period</b>
<p>We are also seriously concerned about the proposed two to three-month transition period, which is entirely inadequate for implementing these changes effectively. Such a short timeframe fails to provide tenants and landlords with sufficient time to adapt, potentially leaving vulnerable tenants without stable accommodation in an already challenging market. The lettings sector is complex and fragmented. Software systems (typically administered by third parties) will need time to re-engineer. The retraining of lettings agents and property managers takes time. We strongly believe that no less than six months' notice should be given between Royal Assent and the commencement date. This will afford landlords and letting agents sufficient time to implement the necessary regulatory changes in an orderly manner, ensuring a consistent and fair approach for tenants seeking rented accommodation. 

<p><b>It doesn't fix the real issue</b>
<p>Foxtons supports the vision of a fair and sustainable rental market that works for everyone. However, these last-minute amendments fail to address the real issue: the chronic undersupply of housing and the resulting supply/demand imbalance. Instead, they risk creating unintended consequences that make the rental market even more challenging for lower-income tenants. 

<p>At a minimum, it is essential for the government to address this question: how can those who narrowly miss affordability criteria overcome the barriers to housing these changes will create? Without a clear answer, achieving a fair lettings market for tenants will remain out of reach. 

<p>We would welcome the opportunity to meet with you to discuss how we can support the government in creating a balanced and sustainable plan that benefits lower income tenants and reduces the risk of landlords withdrawing from the rental market. 

<p>I am copying this letter to the Lords Minister for Housing and Local Government.</p>

<br>
<p>Yours sincerely, </p>
<br>
<p>Guy Gittins
<p>Chief Executive Officer, Foxtons Group plc
</div> 
<br><br>
<p>It is the unintended consequences of banning upfront payments which really cannot be overstated. As Guy explained in the letter:  

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      <div class="number-large">3,000,000</div>
      <div>people rent in London</div>

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       <p>We see 10-15% of tenants use some form of upfront payment to secure a property they'd otherwise not meet the criteria for.
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  <p>That means...     

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      <div><p>tenants would not be able to live in the properties <b>they are currently renting</b>.</div>
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   <p><p><b>Source:</b> This letter is written by Foxtons CEO Guy Gittins, a leader of the property industry with over 20 years of experience in the inner workings of London lettings. This open letter, published here in full, provides transparency on the latest rental market legislation. As your trusted property partner, we are working to ensure your concerns are heard in these critical policy discussions.<p>If you have any questions, please send us an email to <a href='mailto:experts@foxtons.co.uk?subject=Foxtons%20Open%20Letter' target='_blank'>ask a Foxtons expert</a>.</div>




christmas-wreath

<h2 class='intro_basic'>At around this time of year, London sees an annual influx of tourists keen to secure short-term holiday rentals as they look to soak up the unique seasonal atmosphere associated with one of the greatest capital cities on the planet.</h2>

<p>That said, not only can these short-term lets prove a pre-New Year’s day hangover headache for unwitting landlords, so too can long term sub-lets where your tenant hasn’t bothered to seek your permission before giving the keys to someone else.
  
<p>So, what kind of practical measures can you take to help prevent yourself from falling victim to what’s commonly known as ‘unlawful subletting’? Our Director of Legal and Compliance, Manjit Kataora, shares some insight on the fine details of subletting: 


<p><a href='https://www.foxtons.co.uk/' target='_blank'><img src='https://page-assets.foxtons.co.uk/news-images/2024/12/front-doors/720.jpg' alt=''></a></p>




<h3>Tenancy agreement</h3>
<p>The starting point is to check the wording of your tenancy agreement. A decent tenancy agreement will restrict use of the property by the tenant to that of their private residence so that only they and their immediate family can reside in it during the tenancy. This might smack of being merely the proverbial ‘paper shield’ but it’s presence in the agreement is an important pre-condition for initiating legal action, should that later be required. 

<p>Likewise, there should be a contractual clause prohibiting registering a business at the property, and preventing unlawful or immoral use of the property.  

<p>On the back of the popularity of short-term lettings platforms, it’s also common nowadays to have a clause in the tenancy agreement prohibiting the tenant from advertising the property on any internet-based marketing / social media website.  

<p>An assignment clause will prevent the tenant as an individual from ‘sharing’ or’ parting with’ possession of the property with anyone else except those named in the agreement, - usually the tenant and their family members. 

<p>Assignment clauses are usually subject to landlord consent: commonly the wording contains words to the effect as ‘such consent not to be unreasonably withheld by the landlord’.  

<p>Examples of where it would be reasonable for a landlord to refuse permission would include where a proposed sublet would be to individuals who might then create a house in multiple occupation, for which not only would a local authority licence be required, but also potentially substantial and invasive works to the property so that the property then meets the safety conditions contained within the licence conditions.  Such costs can run into several thousands of pounds and, if not carried out by the date specified in the licence, leave the landlord at risk of a fine from the local authority, even where they didn’t know the property was being carved up in that way. It’s quite possible that a landlord in these circumstances might be able to avail a ‘reasonable excuse’ defence against action by the council, but where rent has been collected, the offence is strict liability, i.e. landlords are presumed guilty unless they can prove their innocence. 

<h3>Other permissions and consents</h3>

<p>Mortgage or insurance conditions could also be breached (although its unlikely these would be enforced if you can show no consent to sub-let was actually given and/or that measures are being taken to recover the situation. 

<p>Permission for short-term rentals also carries the risk of breaching the strict ninety-day rule in London. This rule prohibits the letting of property for more than this period in any one calendar year without first having secured planning permission (and may also breach mortgage, insurance and local authority conditions). 

<h3>Increased risk of damage</h3>
<p>Properties used for short-term lets are also at risk not only of increased wear and tear but nuisance as occupants come and go, perhaps at anti-social hours.  

<h3>Company lets</h3>
<p>Corporate lettings should name specific individuals, e.g. a chosen employees as the ‘permitted occupiers’, helping protect the property against a churn of anonymous occupants

<p>It might seem that a tenancy application from a company looks like a safe bet, but there are companies that operate rent-to-rent business models. Such companies might present as student occupancy organisations, but take private rented sector accommodation through letting agents then sub-let the property to multiple occupants – though not before carving up the property internally allowing them to create more individual rooms in order to accommodate multiple occupants. The business model charges individual tenants a greater aggregate rent than is charged to the company by the landlord and profits from the margins, which can be significant where the operation is scaled. 

<h3>Some simple DIY preventative measures</h3>
<p>Unfortunately, even the most plausible tenancy application can sometimes mask hidden risks. But there are a few practical ways to keep an eye and remain alert to the risk of falling victim to unlawful sublets.

<p>A good managing agent will regularly inspect your property and provide you with an inspection report. Their experienced inventory clerks will have seen it all and will be able to look for and identify signs of use at the property inconsistent with single-occupancy use.  

<p>However, inspections take place often months apart, so it’s a good idea as well to periodically check your rental property address on Companies house. Has a company been registered at the address? If it has, alert your agent who can then contact the tenant immediately with the evidence and require that they remove registration from the premises. Not only would Companies House issue paperwork to the property but so to might other regulators, e.g. the ICO. The result can be regular correspondence that can build up over time and expose the address to risk being used for commercial purposes, credit lines, and even fraudulent or criminal activity. 

<p>Check as well to see if the property address comes up on short-let platforms. Tenants who short-let on well-known platforms can only do so much to change the appearance of a property and if you suspect this is going on, do an online check or instruct your managing agent to inspect the property and look for signs of misuse. 

<h3>If you are minded to consent</h3>
<p>Where you are considering granting consent, such consent should only be considered where appropriate references have been taken from the proposed sub-tenants and they can demonstrate they have the right to rent as required under Immigration Act 2014. 

<p>If you are unfortunate to have fallen victim to unlawful sub-let you can recover possession of the property by first serving a Section 8 notice (and, depending on how near you are to a break clause or the end of the tenancy, or if the tenancy is periodic, by serving a Section 21 Notice in parallel). Available grounds within Schedule 2 Housing Act 1988 include: 

<p style="margin-left: 25px"> • Ground 12 -  where any obligation of the tenancy other than one related to the payment of rent has been broken 

<p style="margin-left: 25px"> •	Ground 14 -  nuisance, annoyance, illegal or immoral use of the property – (factors which can be caused by, and are often associated with, unlawful subletting)
 
<p>Granted these are discretionary grounds therefore unless the section 8 notice does the trick, evidence of these factors will need to be placed before the court but it may be relatively easy to obtain, in the form of complaints, etc.

<p>Aside from these discretionary grounds, mandatory ones e.g. arrears can be added and if present will make obtaining possession much easier. 


<figure>
<a href='https://www.foxtons.co.uk' target='_blank'><img src='https://page-assets.foxtons.co.uk/news-images/2024/12/sublet/720.jpg' alt=''></a>
<figcaption>Photo by Foxtons Specialist Video & Photography</figcaption>
</figure>



<h3>Take the weight off</h3>
<p>Perhaps the wisest thing to do is ensure your property is in the hands of an experienced who can help you navigate these risks. Consider as well, rental and legal protection insurance that will save you time and money associated with a costly and potentially lengthy legal process by covering you for expenses if the worst does happen.

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