As we move through the second half of 2025, several key legislative and regulatory changes are beginning to reshape the property landscape in England. These updates affect landlords, letting agents and property professionals alike, covering everything from tenancy law to leasehold reform and compliance requirements.
We believe that staying informed and prepared is the best way to protect your investments and maintain high professional standards. Below is a clear summary of the most important updates and how to respond to them.
1. Leasehold Reform Delayed Following Legal Challenge
The Leasehold and Freehold Reform Act 2024 was set to bring wide-ranging changes to leasehold ownership, including:
- A ban on new leasehold houses
- Lease term extensions up to 990 years
- The removal of the marriage value on short leases
However, implementation is now on hold following a legal challenge by freeholders, who argue that the Act may infringe upon existing property rights. As a result, enforcement may be delayed until late 2025 or beyond.
What this means for you: If you or your clients are involved in leasehold transactions, it is important to keep an eye on these developments and provide up-to-date advice when dealing with affected properties.
2. Renters' Rights Bill: Major Tenancy Reforms Incoming
The Renters' Rights Bill is progressing through Parliament and is expected to introduce several substantial changes to tenancy law in England. The Bill is due to return to the House of Commons in September 2025.
- Periodic tenancies by default
Fixed-term agreements will be replaced by rolling periodic tenancies. Section 21 notices will be removed, and landlords will need to rely on updated Section 8 grounds to regain possession.
- Student accommodation provisions expanded
Ground 4a for possession will now apply to one and two-bedroom student properties, giving landlords the ability to operate with greater flexibility in academic year letting cycles.
- Changes to pet policies
Tenants will have the right to request permission to keep pets. Landlords can no longer enforce blanket bans but may request a refundable pet damage deposit of up to three weeks' rent.
- Council inspections without notice
Local authorities will be permitted to inspect rental properties without giving prior notice. Landlords will be informed shortly after the visit. This measure aims to improve housing standards and target rogue landlords.
- Assured advice for letting agents
Letting agents will be able to access legally recognised compliance guidance under the Primary Authority scheme, particularly around fees, advertising and tenancy terms.
How to prepare: Now is the time to review tenancy templates, update internal procedures and speak with landlords about how these reforms may impact their tenancies going forward.
3. Anti-Money Laundering Enforcement: Over £1 Million in Fines
Between October 2024 and March 2025, nearly 200 agents were fined a combined total exceeding £1 million for failing to comply with HMRC Anti-Money Laundering (AML) supervision rules. Most penalties were issued for failure to register or renew in time.
What you should do: Make sure your business is correctly registered with HMRC, your policies are up to date and all relevant staff are trained. Failing to comply can result in costly penalties and reputational risk.
4. EICR Renewals Now Due
The first round of five-year Electrical Installation Condition Reports (EICRs) is beginning to expire as of July 2025. These reports are a legal requirement for all private rented properties in England.
Action point: Start reviewing your portfolio now and schedule inspections before expiry dates. Staying ahead ensures compliance and avoids any disruption to tenancy renewals or property marketing.
5. Building Safety Levy to Begin in 2026
A new Building Safety Levy will take effect from 1 October 2026. The levy will apply to eligible residential developments in England and is intended to support remediation works on unsafe buildings.
There will be exemptions for certain small-scale developments and social housing projects. Developers and planning teams should start accounting for this in future projects.
Recommended Steps for Agents and Landlords
- Review and update tenancy agreements for periodic tenancies and pet-related clauses
- Conduct a full audit of AML registrations, policies and training
- Schedule EICR renewals early to avoid bottlenecks
- Advise leasehold clients on the implications of the current legal challenge
- Update internal policies and train teams on surprise council inspections
- Engage student landlords on the new eviction grounds under Ground 4a
In Summary
2025 is already proving to be a year of significant change in the property sector. Whether you are a landlord managing a single property or a letting agent overseeing hundreds, being informed and proactive is essential.
At Interlet, we keep up with all current legislation to ensure our services remain compliant and reliable. If you are thinking of letting your property and want it managed professionally, we would be glad to assist.
