Sherrards Legal Insight: The Renters’ Rights Bill and High-Value Tenancies
Owners of super-prime residential assets have, until now, largely sat outside the scope of mainstream rental reform. However, proposed changes under the Renters’ Rights Bill raise an important question: could even the highest-value tenancies be drawn into a more regulated framework?
In this article, Caroline Vernon, Partner at Sherrards, examines how potential adjustments to the high-rent threshold could affect super-prime landlords, what this would mean in practice for tenancy structures and asset strategy, and why 2026 may mark a subtle but meaningful reset for the top end of the rental market.
The Changes
The Renters’ Rights Bill is due to change the legal framework for residential tenancies in England, introducing stronger protections for tenants and increased regulations for landlords.
It is imperative that the position with tenancies for high rents over £100,000 is considered.
The current position, is that rents over this sum are not protected by the Housing Act 1988, such tenancies cannot be Assured or Shorthold tenancies where the rent is above the high rent threshold. Therefore, current tenancies with annual rents over £100,000 are exempt from the statutory protections of The Housing Act 1988. They are considered as common law tenancies governed by the terms of contract and common law requirements. The exemption is there, as such tenants, are deemed ‘sophisticated consumers’ who do not need statutory protection and who can afford to obtain legal advice. Therefore, these tenancies being exempt, fall outside the reform to Assured tenancies in the Renters’ Rights Bill.
However, the Government could of course increase the high rent threshold bringing tenancies with high rents into the reformed assured tenancy regime.
Historically, the threshold was increased in 2010 from £25,000 to £100,000 to reflect rising inflation and changing market conditions. The increase in the annual threshold therefore, meant many more tenancies were then protected by the Housing Act legislation. Clearly rents have risen once again, 15 years having elapsed since the last review. Therefore, we could see that the threshold is raised once again.
What this means for you as a Super Prime Landlord
These higher rent tenancies would then fall within the scope of the Renters’ Rights Bill which means landlords are restricted on rent increase and rent review clauses and landlords would be subject to statutory procedures for rent changes, tenancy renewals and evictions.
Grounds for possession would be required before serving Notices to Quit and compliance would be needed with the Deposit Protection Rules, registering on the private rented sector database and with the private rented sector landlord ombudsman and of course repairing obligations to meet standards under the Decent Homes Standards and AWAAB’s law.
Although only a small number of tenancies will be affected if the threshold raised from £100,000, it would affect landlords, requiring them to follow the increased regulation.
This has the obvious effect of higher regulation, increasing costs as advice is sought and reducing profitability. If such leases are covered by the legislation, then there will be restrictions on rental increases, payments of rent in advance, the procedure for evicting tenants with the abolishment of “no fault” evictions.
It does appear that the market is re-setting due to the Government’s proposed changes. If such leases are brought within the legislation, landlords may face restrictions on rental increases, advance rent payments, and eviction procedures following the abolition of “no fault” evictions.
We could see lease terms shortening, pricing adjustments, and stronger tenant bargaining power emerging across 2026.
Watch points for 2026
Loss of flexibility on vacant possession: the abolition of section 21 reduces the ability to guarantee timely vacant possession, which is particularly significant for super-prime assets where occupation may be linked to sale, refurbishment or personal use.
Increased scrutiny and compliance risk: enhanced standards enforcement and redress mechanisms heighten reputational and financial risk, with non-compliance more visible in the super-prime market.
Impact on tenant selection and structuring: longer-term security for tenants may encourage more cautious vetting, use of higher rents, or alternative occupation structures to manage risk within a premium portfolio.
about sherards
Sherrards is a full-service law firm with a highly experienced team of lawyers. Its residential property specialists, led by partners Caroline Vernon and Asha Ngai, advise homeowners, developers and investors on navigating the complexities of buying and selling property across the full spectrum of the market, from city apartments and new-build schemes to country houses, estates and investment portfolios. The team balances legal, commercial and personal considerations to ensure transactions are handled efficiently and with confidence, working seamlessly with agents and at auction to deliver a smooth and considered process.
get in touch
Caroline Vernon
www.sherrards.com
Sherrards Solicitors LLP
London Office +44 (0)20 7478 9010
St Albans Office +44 (0)1727 832830
law@sherrards.com