The Renters’ Rights Act 2025 introduces significant challenges for landlords, particularly regarding the payment of the first month’s rent. Landlords can no longer withhold keys if the initial rent is unpaid, exposing them to potential fines of up to £40,000. This article explains the legal framework, practical implications, and risks for landlords under the new legislation.

Understanding the Renters’ Rights Act and Key Handover

Under the Renters’ Rights Act 2025, once both landlord and tenant have signed an assured tenancy agreement, the tenancy is considered “entered into.” This means the landlord must provide the tenant with access to the property, even if the first month’s rent has not been paid. Traditionally, landlords have requested the first month’s rent before handing over keys, but the Act prohibits refusing access on this basis.

The period between signing the agreement and the tenancy start date is known as the “permitted pre-tenancy period.” During this time, landlords can accept rent payments in advance, limited to one month’s rent or 28 days’ rent if the payment period is shorter than a month. Deposits can also be accepted up to the legal cap. However, landlords cannot deny possession once the tenancy has been entered into, regardless of rent payment status.

Legal Consequences of Refusing to Hand Over Keys

Refusing to hand over keys after the tenancy agreement has been signed constitutes “preventing occupation,” which is an offence under the Protection from Eviction Act 1977. The Renters’ Rights Act 2025 has introduced civil penalties of up to £40,000 for such offences as an alternative to prosecution. This means landlords face substantial financial risk if they withhold keys due to unpaid rent.

It is crucial for landlords to understand that withholding keys is a serious legal violation. Compliance with this requirement is mandatory, even if the tenant has not fulfilled their rent obligations.

Options for Landlords When Rent Is Not Paid

If the tenant moves in without paying the first month’s rent, landlords can serve a notice under section 8 of the Housing Act 1988, specifying Ground 10 (rent arrears) and providing four weeks’ notice before initiating court proceedings. However, Ground 10 is discretionary, and judges may refuse possession orders or grant tenants additional time to pay, potentially prolonging the process.

Alternatively, landlords may wait until the tenant accrues three months’ rent arrears and then serve a four-week section 8 notice citing Ground 8 (serious rent arrears) and possibly Ground 11 (persistent delay in paying rent). Both the notice date and the court hearing date must reflect the three months’ arrears to be valid.

The Practical Impact: Extended Periods Without Rent

The legislation allows tenants to delay rent payments for extended periods. For example, if a tenancy agreement is signed on 1 May 2026 with a start date of 14 May, the landlord cannot demand rent before signing. After the tenancy begins, the landlord must hand over keys even if the tenant refuses to pay on the day of occupation.

Should the tenant fail to pay, the landlord’s attempts to regain possession through the courts may take several months. Court hearings can be delayed, and judges may offer tenants additional time to pay. This can result in tenants living rent-free for around eight months, leaving landlords responsible for mortgage payments, insurance, and legal costs during this period.

Implications for Landlords and Agents

This situation presents a significant challenge for landlords and letting agents, who must balance legal compliance with financial risk. The inability to withhold keys until rent is paid removes a traditional safeguard, increasing the risk of rent arrears and prolonged eviction processes.

Landlords should carefully consider tenant screening and ensure clear communication about rent payment expectations. Understanding the legal framework and preparing for potential delays in rent collection is essential to managing properties effectively under the Renters’ Rights Act 2025.

Looking Ahead: Support for Landlords

The Landlord Association (TLA) recognises these challenges and is launching a new Trusted Partners Hub in Q1 2026. This platform will feature verified and approved service providers to support landlords, tenants, and property management businesses. Legal, trades, insurance, financial, mortgage, tenant screening, and other service providers are invited to register their interest here: https://landlordassociation.org.uk/become-a-tla-service-partner/.