Looking ahead to 2026, the message for the lettings sector is simple. Change is coming, but it is not chaos. While the focus remains firmly on the Renters Rights Act, a number of quieter but equally important shifts are shaping the market. Understanding what really matters, and preparing early, will be the difference between reacting and staying in control.
The Renters Rights Bill will continue to dominate the conversation and rightly so. It represents the most significant overhaul of the private rented sector in decades and will change how landlords, agents and tenants operate day to day. But focusing on this alone risks missing the wider picture. 2026 is not just about one piece of legislation. It is about a sector that is evolving and, in many ways, professionalising.
One of the most under discussed changes is Making Tax Digital for income tax. From April 2026, landlords with more than £50,000 in annual rental income will be required to submit quarterly digital updates to HMRC. This is based on income, not profit, which is an important distinction. The threshold then reduces year on year, falling to £30,000 in April 2027 and £20,000 by April 2028. Many landlords who do not see themselves as high earning will be caught far sooner than expected. This is not something to panic about, but it is something to plan for, and early conversations with accountants and agents will make a real difference.
Rents are expected to continue rising into 2026, but at a slower and more measured pace than the sharp increases seen over recent years. This is less about demand easing and more about a market absorbing increased costs. Legislative change, higher compliance standards and more intensive management requirements all come at a price. As landlords are required to operate more like businesses, those costs inevitably feed through into rents.
At the same time, supply is unlikely to increase in any meaningful way. While some landlords will leave the sector, particularly older or accidental landlords who no longer want the regulatory burden, others are still entering. The difference is in the type of landlord coming into the market. Increasingly, they are professional, well advised and focused on long term returns. This shift suggests a sector that is not shrinking, but changing shape.
There is also a clear and growing appetite for education. Landlords are not disengaging. They are asking better questions and seeking clarity. Recently, a landlord seminar hosted by a regional letting firm attracted over 160 landlords, with strong engagement throughout the evening. The discussion was practical and forward looking, driven by preparation rather than fear. That appetite is unlikely to be isolated and reflects a wider desire across the country to understand the changes ahead.
This is where letting agents become essential. 2026 will reinforce the role of agents as trusted partners rather than transactional intermediaries. The agents who add the most value will be those who stay ahead of legislative change, communicate clearly and help landlords plan rather than react. The days of simply finding a tenant and collecting rent are long gone, and the market is better for it.
The year ahead should not be framed as something to fear. The lettings sector has always been resilient. It has navigated tax reform, licensing schemes, interest rate shocks and regulatory change before. Each time, the businesses that emerged strongest were those that stayed informed, stayed professional and worked collaboratively.
As the year draws to a close, there is room for a pause. Christmas should be exactly that. But as 2026 begins, preparation will matter. Landlords and agents who invest time in understanding the changes ahead and working together will start the year with confidence.
The market is changing, but it is not broken. With the right mindset and the right partnerships, 2026 has the potential to be a year of stability, adjustment and opportunity.
Sophie Lang is co-founder of Lang Llewellyn & Co.
Prepare to surgically screen prospective tenants and guarantors as the Courts will be reactive with the extra work load.
I had a friend who got possession 2 weeks ago after 14months, the tenant was initially working but then signed on..luckily housing was diverted after 8 weeks, but as usual council made him stay to the last.
Prepare for a massive drop in values.
MTD easy, just take an educated guess on the 4 rental submissions but make certain the balancing one is accurate.
All the fintech banks are working on free submission software.
Sadly a bad time to be a tenant, I’ve been back in the UK for December and noticed a few more oddly parked caravans than 6 months ago.
A lot of decisions to made by many property owners this coming year.
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