Renters' Rights Act: is serviced accommodation a better option for landlords?

The Renters' Rights Bill is now the Renters' Rights Act 2025. Its first major tenancy reforms came into force in England on 1 May 2026, changing the balance of flexibility, responsibility and risk in traditional buy-to-let.

That does not make long-term letting a bad investment. It does mean landlords should review their strategy rather than assume the model that worked five years ago is still the best fit today.

For the right property, serviced accommodation can offer more operational control, flexible pricing and access to several types of guest. It also creates more work. The opportunity only makes sense when the numbers, local rules and management plan all stand up.

What changed under the Renters' Rights Act?

The biggest change is the end of Section 21 'no-fault' eviction for the private rented sector in England. Most assured shorthold tenancies became assured periodic tenancies from 1 May 2026, with no fixed end date.

Landlords can still recover a property using the relevant possession grounds, including when they intend to sell or move in. They need the correct ground, notice and evidence. The Government has published specific possession guidance for landlords.

Other changes include:

• Rent increases are generally limited to once a year, using the prescribed process
• Landlords cannot encourage or accept bids above the advertised rent
• Rent in advance is generally capped at one month after the tenancy agreement is signed
• Tenants can request a pet, and landlords must consider the request reasonably
• Landlords cannot refuse tenants simply because they have children or receive benefits
• Councils have stronger enforcement powers, with further reforms planned through the private rented sector database and ombudsman

The full timetable is set out in the Government's Renters' Rights Act implementation roadmap.

How has this changed the buy-to-let landscape?

Traditional buy-to-let now requires more structured compliance and a clearer plan for possession, rent reviews and communication. Landlords also need to account for a tenant's ability to end a periodic tenancy with notice.

For good landlords, many of these changes formalise sensible practice. The commercial effect is still real. Flexibility has shifted, administrative mistakes carry more risk, and passive ownership is becoming harder.

This is why more landlords are comparing long-term rent with other operating models rather than looking only at the headline monthly rent.

Why serviced accommodation may be a strong alternative

Serviced accommodation is a property offered for short stays with furniture, utilities and guest-ready service included. Bookings may come through Airbnb, Booking.com, Vrbo or directly.

For a suitable property, the model can offer:

• Flexible nightly pricing around seasonality, local events and demand
• A mix of leisure, business, relocation and contractor guests
• Regular access to inspect, maintain and improve the property between stays
• The ability to distribute availability across several booking platforms
• Potential gross revenue above a conventional tenancy when demand and operations are strong

The word 'potential' matters. Higher gross revenue does not automatically mean higher profit. Cleaning, utilities, furnishing, maintenance, platform fees, guest support and quieter periods all need to be included in the forecast.

Short lets are not a loophole

A genuine holiday let or short-stay arrangement is different from an assured residential tenancy. Simply labelling an agreement as serviced accommodation does not decide its legal status. The real use of the property and the nature of the occupation matter.

Planning is also critical. In Greater London, a home can generally be used for short-term letting for up to 90 nights in a calendar year without that use being treated as a material change requiring planning permission, subject to the relevant conditions. Beyond that, planning permission may be required. See the Government's planning guidance for short-term lets.

Landlords should also check:

• Local planning policy and any licensing or registration requirements
• The mortgage terms, superior lease and freeholder rules
• Insurance that specifically covers paying short-stay guests
• Fire, gas, electrical and general safety responsibilities
• Tax treatment and whether council tax or business rates apply

The former Furnished Holiday Lettings tax regime was abolished from April 2025, so short lets no longer carry those old automatic tax advantages. The Government's holiday accommodation guidance is a useful starting point, alongside professional tax and legal advice.

Is serviced accommodation right for your property?

Start with the property, not the platform. A strong short-let candidate usually has a clear reason for guests to stay in that location, an achievable nightly rate and a practical operating plan.

Ask five questions:

1. Is there reliable demand from leisure, business or relocation guests?
2. Do the lease, mortgage, insurance and local planning rules allow the intended use?
3. What will revenue look like after every operating cost?
4. Can the property deliver a consistently good guest experience?
5. Who will manage pricing, messages, cleaning, maintenance and emergencies?

If the answers are strong, serviced accommodation can be a compelling alternative to traditional buy-to-let. If they are not, improving the long-term rental model may still be the better decision.

This article is general information for landlords in England. It is not legal, tax, financial or planning advice. Rules can vary by property and area, so seek professional advice before changing how a property is used.