One in four landlords reject tenants they would previously accept

One in four landlords reject tenants they would previously accept

Following the Renters’ Rights Act, 26% of landlords are now more likely to reject tenants they would have accepted before, with many preferring to leave properties vacant rather than take on higher-risk applicants.

The introduction of the Renters’ Rights Act has led to a marked shift in landlord tenant selection behaviour. According to early findings from Goodlord’s 9th State of the Industry Report, released in October 2026, 26% of landlords have tightened their tenant criteria and are more likely to reject applicants they would have previously accepted. This trend is accompanied by a cautious approach from letting agents, with 51% reporting increased wariness when recommending tenants compared to the previous year. Additionally, nearly a third of landlords (31%) would rather keep a property empty than rent it to a tenant they perceive as higher risk.

This change follows significant legislative reforms, including the abolition of Section 21 eviction notices, restrictions on rent payments in advance, and a ban on over-bidding for rental properties. These measures, designed to enhance tenant security, appear to have had unintended consequences for landlords’ willingness to accept certain applicants.

Impact of the Renters’ Rights Act on landlord behaviour

The Renters’ Rights Act, which came into force recently, has fundamentally altered the private rented sector’s operational landscape. By removing Section 21, landlords lost a relatively straightforward no-fault eviction route, making it more difficult to regain possession of properties. Coupled with the ban on rent in advance and over-bidding, landlords face increased financial and legal risks when taking on tenants who might present challenges in rent payment or tenancy management.

Goodlord’s report highlights that these changes have made landlords more selective. The CEO of Goodlord, William Reeve, noted that certain groups—students, foreign nationals, and those with non-traditional income sources—are disproportionately affected, finding it harder to secure tenancies. The market is becoming more cautious, creating a divide between tenants who are already settled and those seeking new homes.

Letting agents are also adapting their recommendations in response to these reforms. With over half adopting a more cautious stance, agents may be advising landlords to avoid tenants who do not fit traditional risk profiles, which could further limit housing options for vulnerable groups.

Context and ongoing market sentiment

The report also introduces The Sentiment Index, tracking feelings among landlords, agents, and tenants over four years. While landlord pessimism has decreased slightly from 78% in 2025 to 69% in 2026, it remains high, especially among larger landlords managing six or more properties. In contrast, tenants, particularly younger age groups, are becoming more optimistic about the rental market.

This divergence in sentiment suggests landlords remain cautious about the sector’s prospects, possibly influenced by the increased regulatory burden and tenant selection challenges. The cautious approach to tenant acceptance may reflect landlords’ attempts to mitigate risks in a more regulated environment.

Practical implications for landlords and agents

For landlords, the findings underline the need to carefully assess tenant applications, balancing the desire to let properties quickly against the risks associated with more stringent tenant protections. The removal of Section 21 means that eviction processes are more complex and costly, so landlords may prefer tenants with stable income and rental histories.

Letting agents should be aware of their growing role in tenant vetting and advising landlords. Their increased caution could influence which tenants gain access to the market, potentially disadvantaging those with non-standard employment or income sources. Agents may need to develop more robust assessment criteria and risk management strategies to support landlords effectively.

Landlords and agents should also monitor ongoing regulatory developments and guidance to ensure compliance with the Renters’ Rights Act and related legislation. Understanding the nuances of tenant rights and eviction procedures is crucial to managing portfolios successfully under the new regime.

Uncertainties and areas to watch

The long-term effects of the Renters’ Rights Act on the private rented sector remain uncertain. While the initial data shows increased tenant rejection and cautious letting, it is unclear how this will affect overall rental market supply and affordability. There is a risk that vulnerable tenants could face exclusion, exacerbating housing inequalities.

Future government policy responses and potential amendments to the Act may also influence landlord behaviour. Stakeholders should watch for any adjustments to eviction processes, rent payment regulations, or tenant screening rules that could alleviate or intensify current challenges.

Additionally, the impact on landlord retention in the market is a concern. If landlords become too risk-averse or pessimistic, this could reduce rental housing availability, affecting tenants’ choice and market dynamics.

What landlords should consider now

• Review tenant vetting procedures to align with the new legal framework and risk environment.
• Keep abreast of official guidance on the Renters’ Rights Act and related tenancy law changes.
• Consider the financial and legal implications of tenant selection decisions, especially given the loss of Section 21 eviction rights.
• Engage with letting agents to ensure tenant recommendations reflect a balanced risk assessment without unfair exclusion of certain groups.
• Maintain thorough records of tenant applications and decision-making processes to demonstrate compliance and fairness.

Supporting landlords through regulatory changes with TLA

The Landlord Association (TLA) offers members practical support to manage the challenges arising from the Renters’ Rights Act. Membership provides access to up-to-date compliance resources, including guidance on tenancy law changes and tenant selection best practices. TLA’s new property management and compliance platform, ORBIT, currently in BETA testing, helps landlords and letting agents organise property records, manage rental documents, and keep evidence of compliance activities together in one place. Features relevant to tenant vetting and tenancy management are being developed to assist members in adapting to the evolving regulatory environment.

Exploring TLA membership and ORBIT BETA access can help landlords stay informed and organised as the sector adjusts to new legal requirements. While TLA does not provide legal advice, its resources and tools aim to support landlords in making informed decisions and maintaining compliance amid ongoing changes.

Landlords should consider reviewing their tenant selection policies and documentation processes with TLA’s support to mitigate risks and respond effectively to the shifting market conditions.

Looking ahead, the private rented sector will need to balance tenant protections with landlord confidence to maintain a sustainable and accessible rental market. Monitoring market sentiment and regulatory developments will be essential for landlords and agents navigating this complex period.

Sources: Landlord Today