If 2025 was a year of recalibration, 2026 is shaping up to be a year of calculated action. The market isn’t anticipating fireworks, and with rental growth hovering around 2.5-3.5% suggest we’re entering a period where strategy matters more than speculation.
While the Autumn Budget caused somewhat of a flurry in the sector, the industry’s commitment is still high. So much so, recent Savills analysis suggests that total returns for the 2026–2030 period are expected to average 7.8% per annum, outperforming previous year’s predictions.
But let’s not jump to 2030 yet, for multitenant Investors, Asset Managers, and Operators, here is what could be on the cards for 2026:
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1. The Death of the “Passive” Landlord
The implementation of the Renters’ Rights Act (May 1st, 2026) is putting pressure on hands-off asset management. The end of fixed-term tenancies and Section 21 evictions means that retention is now a key financial KPI.
Investors are no longer guaranteed 12-month lease blocks. Instead, they might need to turn to real-time occupancy data and resident sentiment to predict churn. The shift to periodic tenancies increases operational complexity, and operational expenses could rise by up to £2,000 per unit annually.
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2. Awaab’s Law: The 24-Hour Compliance Race
The Renters’ Rights Act also contains provisions to extend Awaab’s Law to the PRS, which creates fixed statutory windows, often as little as 24 hours for emergency hazards. There is government planning for consultation on details including implementation timescales in due course, and while this isn’t due to effect PBSA for a few years yet – we’ll hear a lot more about this in 2026.
There’s also a key PBSA exemption worth noting: private PBSA that complies with UNIPOL and ANUK student housing codes will be exempt from the assured tenancy regime under the Renters’ Rights Act, which may impact how Awaab’s Law applies to this sector.
While PBSA landlords have more time than initially thought, we’re already seeing BTR operators pivot to preventative maintenance models, using IoT sensors to flag warning signs like humidity levels, temperature variations, and water flow issues before they become reportable hazards. When the law does arrive, the 24-hour emergency repair deadline needs a proactive approach.
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3. The “North-South Reset”
Here’s where the national averages become somewhat (and dare we say it) meaningless… London and the South East face growth constraints due to affordability ceilings. Meanwhile, the North West, Scotland, and Wales are outperforming. Savills predicts the Northwest will continue its decade-long run as a top performer, as investors seek higher yields to act as a safety net against softer capital growth.
The data continues to support regional “lifecycle living” hubs, BTR, PBSA, and Single-Family Rental (SFR) schemes in Manchester, Leeds, and Glasgow, where lower entry points and deeper tenant demand offer more of a safety net.
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4. EPC Reform: From “Paper” to “Performance”
2026 marks a landmark shift in how we measure building efficiency. The rollout of RdSAP 10 (the new EPC methodology) means that theoretical ratings are being replaced by real performance data.
2026 is the year to stress-test portfolios against the 2030 EPC C requirements. Getting ahead in 2026 might look more like using granular data to prioritise retrofits where they actually move the needle on carbon and cost, rather than just chasing a certificate.
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5. BTR’s Consolidation Moment
Build-to-Rent sits at just 2% of the UK’s private rented sector, around 100,000 homes. Compare that to 30% in Germany or 37% in the US. To reach even 10% UK market share would require an additional 470,000 units.
The scale of the opportunity is attracting huge institutional investment. A landmark example is the £628.9 million acquisition of the PRS REIT portfolio by Northern LGPS and LPPI, a clear signal that larger portfolios are changing hands this year.
So, What Does This All Mean?
2026 is set to be the year where forward-thinking operators are distinguishing themselves by turning regulatory shifts into a competitive advantage. We’re moving toward a landscape where the most resilient portfolios are those fuelled by real-time intelligence, allowing proactive managers to set new standards for excellence and lead the market into a more professional, data-driven era.
The fundamentals remain strong. Institutional appetite is there, demand massively outstrips supply, and consolidation is creating a more professional, more resilient sector. But the rules of engagement have shifted. Awaab’s Law timelines don’t accommodate slow response systems. The Renters’ Rights Act has removed lease certainty as a given. EPC reform is moving the goalposts on what “efficient” actually means.
We’re not calling the winners and losers here. But we are watching how the market is positioning itself. And the gap between those treating 2026 as business-as-usual and those fundamentally rethinking their operational models is widening fast.