The Renters Rights Act is a piece of legislation that implements Labour’s manifesto commitment to transform the experience of private renting. It contains a number of provisions that raise the standards for renters, and give them more stability in their homes.
Certain parts of the Renters’ Rights Act 2025 came into force on 27 December 2025 and section 31 is one of them. It makes important changes to fixed term tenancies that last for more than 21 years.
What does section 31 say?
Section 31 of the Renters’ Rights Act amends Schedule 1 to the Housing Act 1988 to provide that a fixed term tenancy for a term of more than 21 years cannot be an assured tenancy.
What does that mean?
Overall, it strengthens the tenants position and gives them greater protections against eviction.
What was the previous position?
Previously, long residential leases could be classified as assured shorthold tenancies. So, people who had shared ownership of a house could be seen as assured shorthold tenants, rather than outright owners. Similarly, anyone who owned a leasehold, could be seen as an assured shorthold tenant, even if their lease was for over 50 years (by way of example).
The problem with this position was that leaseholders could face eviction for breaches of the lease. This led to disproportionate consequences. Most leaseholders have to pay ground rent, which is often fairly small, such as £250 a year. If they fell into arrears, then they risked losing their home, for what appears to be a minor breach. The landlord was entitled to seek possession.
People caught in this trap were:
- Owners of leaseholds where the ground rent exceeded £250 per year (or to £1,000 per year in Greater London)
These tenancies were considered to be assured shorthold tenancies
- Shared Ownership arrangements
If the shared owner had not reached 100% ownership, they were treated as having a fixed term assured tenancy.
People in these groups were vulnerable to possession proceedings for minor breaches of the lease.
How does section 31 protect renters?
Section 31 prevents these people from being seen as assured shorthold tenants.
That means that if the landlord now wants to regain possession, they will need to use the forfeiture process instead, for breach of a covenant in the lease. The forfeiture process is more stringent and it is a more complex procedure.
What does it mean for conveyancers?
Conveyancers should be aware of the changes and amend their advice to people buying leasehold properties, and lenders who are providing the mortgage.
The ground rent amount is no longer a risk factor for converting assured shorthold tenancies to long leases. Lenders and buyers of shared ownership properties now have more security in their homes, as they’re no longer at risk of section 8 possession proceedings for rent arrears or service charge arrears.
Overall, the changes in the Renters’ Rights Act make leasehold properties slightly more attractive to buyers. There are still risks with these properties, such as the possibility of major works bills, or restrictions on the buyer’s use of the property. However, they are now more secure in their homes and can no longer be evicted for minor breaches of the lease.