Whether you let commercial property or residential homes, understanding rent reviews is more important than ever, especially with changes introduced by the Renters Reform Bill in 2025.
Whether you let commercial property or residential homes, understanding rent reviews is more important than ever, especially with changes introduced by the Renters Reform Bill in 2025.
What is a rent review?
A rent review is the formal process of reassessing the rent charged on a property and adjusting it (usually upwards) based on current market conditions. Rent reviews are most common in commercial leases and long-term residential tenancies, and are often built into tenancy agreements at fixed intervals, typically every 3 to 5 years. In residential lettings, especially under periodic tenancies (which will soon become the default under new legislation), rent adjustments are made using Section 13 of the Housing Act 1988.
Why do landlords need rent reviews?
1. Stay in Line with Market Rents
Markets fluctuate. Without rent reviews or scheduled increases, you could find yourself charging well below what’s reasonable for your property’s location, condition, or demand.
2. Maintain Investment
Returns With inflation, tax changes, and increasing maintenance costs, rent reviews help landlords preserve the real value of their income and maintain long-term profitability.
3. Plan for the Future
Scheduled reviews give both landlords and tenants a predictable structure for changes in rent, which helps with financial planning and portfolio management.
4. Remain Legally Compliant
Failing to follow proper procedures can lead to disputes or invalidate the increase. Using the correct route — especially in residential tenancies — ensures compliance with UK law.
Recent changes: what landlords must know
The Renters Reform Bill, expected to come into full effect by the end of 2025, introduces several key changes: • All Tenancies Will Become Periodic
The Bill abolishes fixed-term Assured Shorthold Tenancies (ASTs). This means all residential tenancies will roll on a monthly basis with no fixed end date — and rent increases will need to follow a set legal process.
Section 13 is the Only Valid Rent Increase Route
Under the new framework, the only way to increase rent in a residential tenancy will be by serving a Section 13 notice, once per year.
Two Months’ Notice Required
Landlords must now give a minimum of two months’ notice when proposing a rent increase via Section 13.
Rent Must Reflect Market Value
Increases must be reasonable and in line with comparable properties. Tenants can challenge any proposed increase through the First-tier Tribunal if they believe it’s excessive.
Use the Official Form 4
To serve a Section 13 notice, landlords must use the official Form 4, completed correctly. Mistakes can make the notice invalid, so professional guidance is advisable.
What about commercial properties?
Rent reviews in commercial leases operate differently:
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Reviews are usually built into the lease and take place every 3 to 5 years.
- The review might use open market rental values, RPI-linked increases, or fixed uplifts.
- Many leases include “upward-only” clauses, meaning rent can rise but not fall — though this approach is increasingly scrutinised.
Disputes are typically resolved through negotiation, expert determination, or arbitration. Due to their complexity, commercial rent reviews often require a chartered surveyor’s input.
Final thoughts
Rent reviews, when properly managed, are a vital part of protecting and maximising your rental income. With the evolving legal landscape — particularly for residential landlords — it’s more important than ever to understand your obligations and rights. At Winkworth, we’re here to support landlords with expert guidance on rent reviews, tenancy management, and market appraisals.
