Ask a letting agency owner what the Renters’ Rights Act has done to the value of their business and you will usually get one of two answers. Either it has “killed it” — landlords are leaving, stock is shrinking, who would buy into that — or it has changed nothing at all, because rent is still collected and the units are still there.
Four months of evidence says both are wrong, and in an interesting way.
The Act has made a managed lettings book harder to run and more valuable to own. Those two things sound contradictory. They are not. They are the same fact seen from two ends, and understanding why is worth real money to anyone thinking about an exit in the next eighteen months.
What actually changed on 1 May
Briefly, because most owners reading this have lived it.
The tenancy reforms in the Renters’ Rights Act 2025 commenced on 1 May 2026. On that date every existing assured shorthold tenancy converted automatically to an assured periodic tenancy. Fixed terms became rolling. Section 21 was abolished, leaving Section 8 grounds as the only route to possession. Contractual rent review clauses ceased to bite, replaced by a statutory procedure. Rental bidding was prohibited and advance rent payments banned for new tenancies. Tenants gained a statutory right to request a pet, and discrimination protections covering children and benefit recipients took effect. A civil penalty regime came with it — up to £7,000 for breaches and up to £40,000 for serious or repeat offences. Landlords had until 31 May to get the Government’s information sheet to every existing tenant.
Three further pieces are still to land: the PRS Database, expected to begin rolling out from late 2026 and become compulsory during 2027; the PRS Landlord Ombudsman, anticipated around 2028; and the Decent Homes Standard for the private rented sector, currently timetabled for 2035. Those dates are indicative and have moved before — but the direction of travel has not.
If you want the mechanics of how all this interacts with a sale process specifically, we covered that separately in the Renters’ Rights Act and selling an estate agency. This piece is about what it has done to price.
The four-month scoreboard
Compliance work went up, as expected. In a survey of letting agents published on 4 September 2026 by The Letting Partnership, 62.5% reported more compliance and administration time since May — 29.2% describing the rise as significant and 33.3% as slight. Nearly half named increased administration as the single biggest effect on their business, and 22.7% pointed to more disputes and uncertainty.
Agents were, on the whole, ready. In the same survey 79.2% described themselves as completely or mostly prepared. This matters more than it looks. A regulatory change that competent operators absorb and weak ones cannot is precisely the kind of change that concentrates a market — and consolidation is what buyers pay for.
Some of the cost is already being passed on. Goodlord research reported in August found 23% of letting agents had increased their charges to landlords since the Act came into force, with 50% of landlords reporting more compliance work of their own and 39% tightening their tenant vetting.
Sentiment is poor, but selling has slowed rather than accelerated. 62.5% of agents in the Letting Partnership survey said the Act had damaged landlord sentiment, and half expect a weaker private rented sector in twelve months. Yet Goodlord’s April 2026 poll of more than 1,200 landlords found 24% actively selling part or all of a portfolio, down from 35% the previous September. The exodus is real but it is a decade-long trend, not a May 2026 event: TwentyEA’s Q2 2026 report counted almost 850,000 homes leaving the private rented sector over ten years — 18.6% of stock — with the peak year being 2025, before the Act commenced.
And the demand side did something owners did not expect. Propertymark’s Housing Insight Report in June recorded member agents across England reporting let-only landlords converting to full management, and previously self-managing landlords approaching agents for the first time. One Sussex agent put it plainly: “I have been pleasantly surprised by the number of let only landlords that have converted to the managed service due to the change in legislation.” Against roughly seven prospective tenants per available property, the units that remain are not sitting empty.
What that has done to value
Put those five findings together and four consequences follow — and they are what anyone weighing an exit should be thinking about.
1. The managed book got a wider moat
Before May, a self-managing landlord with four flats could plausibly do it themselves. Post-Act, with Section 21 gone, statutory rent procedures, pet requests to adjudicate, a penalty regime with a £40,000 ceiling and a database registration coming, the amateur route is materially harder. Propertymark’s members are seeing the switch happen.
For a buyer, that changes the quality of the earnings, not just the quantity. A managed unit is stickier than it was eighteen months ago, because the cost of the landlord taking it back in-house went up. Stickier revenue is worth a higher multiple than the same revenue with a lower barrier around it. This is the single most under-appreciated effect of the Act on what a lettings book is worth.
2. Cost to serve went up, and buyers price the post-Act cost base
The other side of the same coin. If 62.5% of agents are spending more hours per property, the maintainable EBITDA of a lettings business is not what it was in the 2024/25 accounts.
Any experienced acquirer knows this and will normalise for it. Expect a buyer to look past headline turnover to hours per managed unit, staff cost per unit, and whether your fee scale has been reviewed since May. The 23% of agents who have already put fees up are, whether they intended it or not, in a stronger position at the negotiating table than the 77% who have absorbed the cost. If you are planning a sale in 2027, a fee review now is one of the highest-return pieces of preparation available to you — it lands in the accounts a buyer will actually underwrite.
3. Attrition is the number you cannot explain away
Landlord portfolio exits are the mechanism by which a managed book shrinks without anybody doing anything wrong. If roughly a quarter of landlords are selling part or all of a portfolio, some of them are yours — and a single net unit count hides which.
What you should have ready, and what most owners do not: monthly managed-unit counts for at least twenty-four months, split by units lost to landlord sale, units lost to a competitor, and units gained. Those three lines tell a completely different story from a single net figure, and the difference is worth real money. A book that lost 6% of units to landlords selling while winning 9% from self-managers is a growth business. A book that lost 6% to the agency down the road is a problem. The net number is identical — and if you cannot separate the two, you are asking a buyer to take the better reading on trust.
4. The seller pool widened — and the buyers followed
This is the part that shows up in the deal record rather than the surveys, and it is unambiguous.
- Dwelly acquired AP Morgan’s lettings book — around 500 fully managed properties in the West Midlands — on 16 July 2026. It was Dwelly’s eighth acquisition of 2026, taking the group to roughly 14,000 properties. AP Morgan’s founders kept the sales business. Dwelly’s head of M&A, Sam Humphreys, described the pattern directly: “Increasingly, we’re speaking to businesses that recognise the growing complexity of the lettings sector and want a partner that specialises in helping those businesses continue to thrive.”
- Earlier, in December 2025, Dwelly acquired the lettings operation of Sheldon Bosley Knight, a 13-branch Coventry-headquartered agency with a £25m rent book. Mike Cleary framed the choice as between battling on alone or giving up ownership to give the team and clients a better future.
- Lomond — reported above 70,000 managed properties by August 2025 — bought the lettings books of Regal Estates in Kent and Margaret Duffus in Scotland in the same month, with both sets of sellers citing the legislative environment. Mark Pullinger’s stated reason: “in this evolving legislative landscape, we believe their needs will be better met with the support of a larger organisation offering broader technologies and capabilities.”
Notice what all three have in common. The lettings book sold; the sales business did not. That is the defining pattern of this market and the Act has sharpened it — we set out the full buyer landscape in who’s buying UK estate and letting agencies in 2026.
So has it helped or hurt?
Honestly: it depends entirely on which agency you own.
If you run a well-systemised managed book, the Act has been good for you. Your compliance capability is now a product landlords need rather than a cost they resent, your revenue is stickier, and there are well-funded buyers explicitly hunting businesses like yours. The evidence does not support waiting for conditions to improve — conditions are already improving for you.
If you run a let-only or lightly-managed book, the picture is harder. Let-only is the model the Act squeezes most, and buyers discount it accordingly. Converting landlords to full management before you go to market is worth more than almost anything else you could do in the same twelve months.
If you are a mixed sales-and-lettings independent, expect to be priced in two halves — and know which half the competition is for.
If you were going to exit within five years anyway, the arithmetic has changed. The database and ombudsman are still ahead of you, each with its own compliance build. Every one of those is a cost you carry and a buyer inherits. There is a reasonable case that the best window to sell a lettings book is before the next tranche lands, not after.
How we can help
The Acquisitions Group specialises in selling estate and letting agencies, and the team has acquired 156+ businesses in five years — so we know what buyers ask, because we have sat on their side of the table.
If you want to know what your book is worth in the post-Act market, our free valuation tool gives you an indicative range in a few minutes. If you would rather talk it through confidentially, including what your attrition numbers actually say about your business, get in touch — no obligation, and nothing leaves the room.
Sources
- The Renters’ Rights Act 2025 information sheet and implementation guidance, GOV.UK, 2026
- Renters’ Rights Act implementation timeline, The Independent Landlord, 2026
- The Letting Partnership agent survey, reported by The Intermediary and Landlord Today, 4 September 2026
- Goodlord landlord research, reported by Letting Agent Today, August 2026
- Goodlord landlord survey of 1,200+ landlords, April 2026, reported by Property118
- TwentyEA Property & Homemover Report, Q2 2026, reported by Property Industry Eye
- Propertymark Housing Insight Report, 16 June 2026
- “Agency’s 8th acquisition this year adds 500 properties to portfolio”, Letting Agent Today, 16 July 2026
- “Major Midlands lettings operation sold to software firm”, The Negotiator, 2 December 2025
- “Two business owners sell their lettings book to Lomond citing legislative challenges”, The Negotiator, 12 August 2025
- “Lomond snaps up sixth London lettings business in 11 months”, The Negotiator, 2025