The £40k Compliance Trap

Is Your Property Portfolio Ready for May 2026?

The biggest earthquake in UK rental law in 30 years is officially on its way. If you are a landlord or property manager, the rules of the game are changing on May 1, 2026.

The Assured Shorthold Tenancy (AST) as we know it is being abolished. In its place? A "rolling" system that gives tenants more power and puts landlords at risk of massive fines if they miss even a single document.

Here is everything you need to know to survive the transition to the 2026 Periodic Tenancy System

1. The "Big Switch": Goodbye AST, Hello APT

From May 2026, the concept of a "6-month fixed term" disappears. Every tenancy becomes a rolling periodic tenancy from day one

• The Catch: Tenants can give two months' notice to leave at any time
• The Impact: Landlords can no longer rely on the "Section 21" no-fault eviction. You now need a specific, proven legal ground to reclaim your property

2. The May 31 Deadline: The Compliance Cliff

By May 31, 2026, every landlord in the UK must have served mandatory government "Information Sheets" to their existing tenants

• The Penalty: Missing this deadline isn't just a slap on the wrist. It’s a £4,000 fine per breach
• The Real Danger: If you miss this paperwork, your property becomes "legally paralysed." You will be unable to use any legal grounds to get your property back until the error is fixed and the fines are paid

3. The New Rules of the Road

The Renters’ Rights Act is not just about evictions; it is about how you conduct business daily

• No Rental Bidding: It is now illegal to accept offers above the asking price. You must list a fixed price and stick to it
• Pet Power: Tenants now have a "Right to Request a Pet." You can’t say no without a very good (and legally documented) reason
• No Discrimination: Refusing tenants because they have children or receive benefits (DSS) is now a legal minefield. Rejections must be backed by "proportionate" evidence, like statutory overcrowding

4. Rent Control and "Awaab’s Law."

• Rent Increases: Limited to once every 12 months. If a tenant challenges it, the Tribunal can now delay your increase for months
• Strict Repairs: Under "Awaab’s Law," if you don't fix damp or mould within strict new timeframes, you could be hit with a Rent Repayment Order (RRO), forcing you to pay back up to 24 months of rent to the tenant

5. The £40,000 Risk

The Local Housing Authorities (LHAs) have been given "super-powers" to investigate landlords

• Standard Breach: £4,000
• Serious/Repeat Offence: Up to £40,000
• Director Liability: If a company owns the property, directors can now be held personally liable for these fines

Strategy: "Clearing the Decks"

Don't wait until April 2026 to panic. We recommend a "Clearing the Decks" audit right now. Review every single one of your tenancies, check your data entries on the new PRS Database, and ensure your "Prior Notices" are ready to go

At 99home, we are already preparing our clients for the 2026 shift. Do not let a paperwork error turn into a £40k nightmare!