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A guide to the Renters' Rights Act for debt advisers

The Renters' Rights Act introduces seismic changes to housing law, with knock on effects for debt advice to private tenants.

Published October 2025

Abolition of section 21 and other headlines

The Renters' Reform Coalition, including Shelter, Citizens Advice, and the Law Centres Federation, has successfully lobbied to end 'no fault' evictions. Section 21 will be abolished in 2026, accompanied by major reforms to tenancy status, grounds for possession, housing standards, penalties, and enforcement.

The fixed term assured shorthold tenancy, currently the standard tenancy in the private sector, will be a thing of the past. It will be replaced with fully assured periodic tenancies, putting private tenants on the same legal footing as those in housing association properties.

A new private landlord register and Ombudsman are set to be created, though both require separate regulations and infrastructure before implementation.

Implications for debt clients

Many of the Act's reforms are designed to benefit renters on low incomes. Changes to the mandatory rent arrears ground 8 raise the arrears threshold before a landlord can serve a notice, and allow tenants more time to resolve benefit issues.

Landlords will no longer be able to use a term in a tenancy to raise the rent, or impose one on the tenant, without following set rules. Rent increases will follow a statutory procedure, and an amended tribunal process will give tenants greater protection when challenging proposed increases.

Some of the knock on effects are not written into the legislation. They might not have even been intended. For example, converting all fixed term tenancies to periodic tenancies affects the rental liability of tenants and guarantors, and overturns caselaw on council tax liability that treated absent tenants as property owners.

It's not all good news. The loss of 'no fault' eviction will increase the number of claims brought by landlords for rent arrears. This has consequences for clients needing homelessness assistance, if their local authority considers them to be at fault. It also makes money claims for rent arrears more likely.

How possession changes affect debt advice

Removing the section 21 notice from a private landlord's arsenal means clients with rent arrears are better placed to negotiate a repayment plan.

As things stand, debt advisers with private tenant clients must warn that however willing the client is to repay arrears, and however reasonable the offer of repayment, the landlord has the option to regain possession using section 21 without supplying the court with a reason.

Under section 21, where the landlord's paperwork is in order, possession is granted without a court hearing. There is no consideration of how the client's circumstances have led to the arrears accruing or what they've done to put things right. The court has no power to take fairness into account.

Once the Renters' Rights Act is implemented, all private landlord possession claims must state a ground, for example rent arrears or antisocial behaviour. A judge must be satisfied that the ground is proven before granting possession. Each claim will be listed for a hearing where the evidence can be tested.

This has implications for advice about a client's potential insolvency solutions as well as payment negotiation.

A recap of the landlord's right to possession after the tenant's insolvency

In 2011, the Court of Appeal ruled that the landlords of two assured tenants could regain possession of their property on rent arrears grounds, even though the tenants had entered into a formal insolvency solution (bankruptcy in one case, a debt relief order in the other).

The Renters' Rights Act does not change this position. A landlord will be able to issue a notice on grounds 8, 10, and 11 following the insolvency of the tenant. Courts can issue outright or suspended possession orders, or adjourn the case, but cannot make an order to recover rent arrears once they are included in an insolvency.

Advising on defending possession action or repaying rent arrears following a bankruptcy or debt relief order requires expert knowledge of insolvency legislation and caselaw. Debt advisers can contact Shelter's Specialist Debt Advice Service for a second opinion.

Read more about possession action following a debt relief order on Shelter Legal.

Possession action during breathing space

A breathing space or mental health crisis moratorium will continue to prevent the issue of a notice or claim or the execution of a warrant on rent arrears grounds.

Private landlords will lose the option to circumvent moratorium protections by using section 21.

Read more about possession action during a breathing space moratorium on Shelter Legal.

Increase in claims on rent arrears grounds

The abolition of section 21 is a mixed blessing for tenants with rent arrears.

On one hand, private landlords will soon need to convince a judge to order possession in every case, with the courts having wider powers to postpone or deny the request. On the other, claims on rent arrears grounds usually include an application for a money judgment, which can be enforced in the same way as any other CCJ.

A possession order on rent arrears grounds can also make a local authority homelessness application less likely to be successful. For example, if someone has a possession order for rent arrears, they might be found to be intentionally homeless. This means the local authority could end the duties they owe to the homeless applicant.

Changes to the mandatory rent arrears ground 8

Ground 8 makes defending rent arrears claims for assured tenants particularly tricky. The court must order possession in cases where the tenant owes at least 2 months rent on the notice and hearing dates. There are strict requirements for the paperwork, but that's it. The court cannot adjourn to await the outcome of a benefit claim, and the eviction warrant cannot be delayed.

The major changes to ground 8 due to be introduced by the Renters' Rights Act include:

  • the level of arrears at the notice and hearing date to be increased to 3 months (from 2 months)

  • the section 8 notice period to be increased to 4 weeks (from 2 weeks)

  • a landlord's failure to protect the tenancy deposit can be a defence

  • a tenant's benefit delays can be a reason to adjourn

This represents a significant shift in the court's power to manage the case appropriately and achieve a fair outcome.

The discretionary rent arrears grounds 10 and 11 remain unchanged.

End of fixed term tenancies

The conversion of fixed term tenancies to periodic tenancies not exceeding one month has consequences that might not have been foreseen by lawmakers, but which will come as good news to debt advisers.

Currently, a tenant leaving before the end of their fixed term remains liable for rent until the term ends. By contrast, under a periodic tenancy, the tenant is only liable for the rent that falls due before their notice period ends.

Guarantor liability will be limited to arrears only

Guarantors typically agree to cover rent for an initial fixed term of six or 12 months. This is lawful, as the tenant’s liability also extends to the fixed term, and the guarantor is acting as surety for that debt.

Once the law changes, the guarantor's liability will be drastically reduced. A guarantor can never be asked to pay more than the principal debtor owes, because it is a secondary liability. That means the guarantor's liability can only mirror the tenant's, which falls one month at a time.

A guarantee that purports to cover more than the tenant’s actual rent liability will be unenforceable to the extent that it exceeds the tenant’s obligations.

Council tax liability cannot continue when the tenant leaves

In Leeds City Council v Broadley, the Court of Appeal held that a tenant who has a material interest - that is, a fixed term of six months or more - can be liable for council tax on two properties at once. A tenant's failure to terminate a contractual periodic tenancy that rolls on from the fixed term means they remain liable for council tax when they move out, because they are classed as the owner.

Under the Renters' Rights Act, a tenant cannot be treated as the owner as their interest in the property is limited to one month at a time. The landlord will be the liable person for council tax on an empty property under s.6 Local Government Finance Act 1992.

No doubt local authorities will welcome this change. They will soon be able to pursue home-owning landlords rather than tenants, who are likely to be harder to track down, especially if they have moved out of borough.

New rules for challenging rent increases

Private rents have risen sharply in recent years. According to the ONS, the average monthly private rent increased by over seven percent in the 12 months to April 2025. For households already stretched, this is a severe burden.

Most increases are imposed by a clause in the tenancy agreement, usually allowing the landlord to put the rent up once a year. Even without a written term, tenants who adhere to a request for an increased sum can find themselves contractually bound to the new rental amount.

Prohibition on contractual increases

The Renters' Rights Act prohibits all contractual rent increases, whether written in the agreement or not. Landlords will need to follow the procedure set out in section 13 Housing Act 1988, which gives tenants an automatic right to challenge the increase at tribunal, free of charge.

Reduction in risk for tribunal challenges

The Act removes some complications currently faced by tenants bring a tribunal challenge. For example, the tribunal will not be able to set a higher rent than that proposed by the landlord, and it won't be able to backdate the increase.

When the changes will take effect

Most key reforms affecting debt advice discussed in this article will come into force during the first implementation phase, likely to be spring 2026.

Section 21 will not vanish overnight when the law changes. While there will be no new section 21 notices for private tenants, valid notices served before the cut off could still proceed, and landlords will have up to three months to start possession proceedings. Assured shorthold tenancies in the social rented sector can still be ended using section 21 until new regulations introduce replacement grounds.

Other measures, such as those dealing with hazards in private rented accommodation, the private landlord register, and the new Ombudsman, rely on secondary legislation. They could take several years to implement fully.

Read more about how and when changes will be implemented.

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About the author

Alexa Jensen is a senior legal editor at Shelter, CPAG Debt Advice Handbook author, and co-author of the regular debt advice update for Legal Action.

For a comprehensive summary of legal changes including rent in advance, new grounds for possession, right to keep a pet and more, read What to expect from the Renters' Rights Act.

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