One of the most impactful financial changes under the Renters’ Rights Act is the introduction of stricter rules around rent increases.

These changes are designed to create a fairer and more transparent system for tenants, while also placing clearer legal responsibilities on landlords when adjusting rental prices.

How do rent increases work currently?

Under the current system, rent increases can vary depending on the type of tenancy agreement in place.

In many cases, landlords can include clauses within fixed-term agreements that allow for rent reviews or they may negotiate new rental amounts when a tenancy is renewed. For periodic tenancies, rent increases are typically carried out using a formal Section 13 notice.

While there are rules in place, the system has historically allowed for a degree of flexibility, which is now being tightened under the new legislation.

What’s changing under the Renters’ Rights Act?

Under the Renters’ Rights Act, rent increases will be limited to once per year and must follow a formal legal process.

Landlords will be required to use a Section 13 notice to increase rent, ensuring that all increases are properly documented and communicated. The intention behind this is to prevent frequent or unexpected rent rises and to give tenants greater stability when planning their finances.

In addition, any increase must reflect the current market rate for similar properties in the local area. This introduces a clearer benchmark and reduces the likelihood of excessive or unjustified rent increases.

How will this affect landlords?

For landlords, this change means that rent reviews must be approached more carefully and strategically.

Rather than adjusting rent more freely, landlords will need to consider the timing of any increase and ensure that it aligns with local market conditions. Setting the rent too high could lead to challenges from tenants or difficulties in retaining occupancy, while setting it too low may impact overall returns.

It also becomes increasingly important to stay informed about local rental values, as evidence may be required to justify any increase. This makes regular market reviews and professional advice more valuable than ever.

What does this mean for tenants?

For tenants, the new rules provide greater predictability and protection.

Knowing that rent can only be increased once per year allows tenants to plan ahead and manage their finances more effectively. It also reduces the risk of sudden or repeated increases within a short period of time.

If a tenant believes a rent increase is unfair or above market value, they will have the right to challenge it through a tribunal. This adds an extra layer of accountability and helps ensure that rental pricing remains reasonable.

Why this change matters

Limiting rent increases is a key part of the wider reforms aimed at creating a more balanced rental market.

It encourages fairness and transparency while still allowing landlords to adjust rents in line with market conditions. However, it also means that landlords must be more precise and informed when setting rental levels.

In a market where demand, affordability and legislation are all evolving, getting this balance right is essential.

The importance of setting the right rent

With tighter controls on how and when rent can be increased, getting the initial rental figure right has never been more important.

Pricing a property correctly from the start helps to attract the right tenants, minimise void periods and reduce the need for adjustments later on. It also ensures that any future increases are more likely to be accepted and supported by market evidence.

This is where experience and local knowledge can make a real difference.

Need advice on rent increases and compliance?

At Seths Estate Agents, we help landlords across Leicester navigate changes to rental legislation with confidence.

From setting the right rental value to managing tenancies in line with the latest legal requirements, we ensure your property is both compliant and performing at its best.

If you are currently self-managing or working with another agent, now is the time to review your approach and make sure you are prepared for these changes.

📞 Call our team on 0116 266 9977 for expert property management.