Renters’ Rights Act 2026: Should UK Landlords Switch to Short-Term Letting?

Long-term letting changed on 1 May 2026. Section 21 “no-fault” evictions are gone, fixed-term tenancies are gone, and landlords now carry more responsibility with less certainty about regaining their property. Naturally, a lot of landlords are looking at short-term letting as the alternative. The honest answer is: it’s worth considering — but it’s not the free upgrade it’s often made out to be.

What actually changed for long-term letting

The Renters’ Rights Act received Royal Assent in October 2025, with its first major phase taking effect 1 May 2026. The headline changes: Section 21 evictions are abolished, meaning landlords can no longer end a tenancy without a specific legal reason. Fixed-term assured shorthold tenancies are gone — every tenancy is now periodic, rolling month to month, with tenants able to leave on two months’ notice at any time. Rent can only be increased once a year through a formal process, and tenants can challenge any increase at tribunal.

Landlord sentiment reflects the weight of this. In the most recent quarterly survey available, nearly half of landlords expect property values to stagnate or fall below inflation over the next three years, and separate reporting from mid-2026 found roughly half of landlords still not confident navigating the changes. A meaningful share have indicated plans to leave the sector entirely.

Why short-term letting looks like the answer

The short-term rental market is genuinely growing. UK platforms recorded 100.9 million guest nights in 2025 — up 11.5% from 90.5 million the year before, according to the Office for National Statistics’ most recent release. Unlike a long-term tenancy, a short-term let gives the owner back control: the calendar, the pricing, and the ability to access the property between bookings without a legal process.

What the “just switch” narrative leaves out

Here’s the part that rarely gets mentioned alongside the Renters’ Rights Act conversation: short-term letting lost its own tax advantage over long-term letting the year before. The Furnished Holiday Lettings tax regime — which let short-term landlords fully deduct mortgage interest, claim a 10% capital gains rate on sale, and count rental profit toward pension contributions — was abolished from 6 April 2025.

So what actually decides whether the switch is worth it

The deciding factor isn’t which one sounds easier on paper. It’s who’s actually running the operation well. The landlords doing well in short-term letting right now aren’t the ones who just moved platforms and hoped for the best. They’re the ones treating it as a real business: pricing that responds to actual demand instead of a guess, a turnover system that doesn’t depend on being available every evening, and a clear-eyed number for what their specific property can earn once real costs are accounted for — not a headline average pulled from a news article.

A short-term let’s viability comes down to your numbers, for your property, in your area — not a national average. Getting that number right, before anything else gets decided, is the difference between switching because it sounds good and switching because it actually works.

This article covers general trends and is not financial, tax, or legal advice. Property-specific decisions should involve a qualified accountant or solicitor familiar with your circumstances.

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