Should you 'price in' the Renters' Rights Act by increasing rents?

Landlords are increasing rents to cover the cost of the Renters’ Rights Act. This was a recent claim by estate agent and property consultant, Knight Frank.

Although the analysis focused on prime rents in London, the findings will strike a chord with landlords across the country. The phrase Knight Frank used was ‘pricing in new rules’ but what exactly does that mean?

Mortgage rates stay stubbornly high

If you’re a landlord, things have been getting more expensive for some time. For starters, mortgage rates are stubbornly high and Zoopla’s September House Price Index said they’re at a three-year peak. For landlords coming off a five-year fixed-rated mortgage, rates are now around 5.3% for a 65% loan to value product, rising to around 5.7% for a 25% loan to value deal.

Service charges reduce profit margins

Most landlords will have also seen an increase in insurance costs and for those with leasehold properties, service charges have kept climbing. In fact, The Property Institute’s latest report, released in May 2026, found average service charges increased by 5.8% between 2024 and 2026.

New rules come at a cost

The Renters’ Rights Act has had a direct and indirect impact on a buy-to-let’s running costs. These include:

• Paying for top-level referencing to limit the risk of tenants who default on rent payments
• Paying for professional management to ensure legal compliance
• Rising eviction costs due to the abolishment of Section 21 notices
• Investing in improvements ahead of the Decent Homes Standard and Awaab’s Law
• Lost rent and void period costs when using Ground 1A – sale of a dwelling house
• Non-compliance penalties that range from £7,000 for standard breaches, up to £40,000
• Annual fee of £65 to join the new landlords’ database
• Legal costs and agent fees if selling to exit the private rental market

Landlords already £5,000 worse off

Just how much are new rules costing landlords? The results of Handlesbanken’s latest survey of some 200 landlords and property investors were made public in July 2026. It found the Renters’ Rights Act had cost landlords and property investors £5,000 by the midpoint of 2026.

More investment needed soon

This figure is set to rise. As yet, we don’t know how much it will cost landlords to join the mandatory ombudsman and revised EPC rules are just over three years away.

It’s estimated between 2.3 to 2.5 million privately rented properties have an EPC of D or E, which would make them an illegal let from 2030. The Energy Saving Trust estimated it will cost landlords between £6,100 and £6,800, on average, to upgrade their properties to the incoming EPC C-rating standard.

What you can charge is limited by market rate caps

It’s only fair that landlords look to recoup costs by increasing the rent. After all, the Tenant Fees Act 2019 ended a convenient route to being reimbursed for some outgoings.

Increasing the rent is the sole way for a landlord to boost income but the Renters’ Rights Act has stepped in to limit how much rents can go up.

Legislation states rents can only be increased once per year, using a Section 13 notice, and that a rent increase must be in line with market rates. Tenants who feel an increase is unjustified can take a landlord to the First-tier Tribunal (Property Chamber).

Landlords will need to gather evidence of what monthly rent is being advertised for a property like theirs, seeing if there is legitimate headroom to increase what they charge.

Open Property Group is increasingly helping landlords with the maths. Balancing income with outgoings is leaving many with no other choice than to exit buy-to-let. If you’d like help with your current operational budget and working on projections for the future, contact our team.

We’ll help you explore the options available, including accepting our cash offer for a quick house sale – no agency fees, no legal costs and no need to evict any sitting tenants.