A series of significant legislative changes are set to reshape the UK property landscape in 2026, impacting millions of homeowners and renters across the nation. The reforms, detailed in the recent Autumn Budget by Chancellor Rachel Reeves, encompass new protections for tenants, long-awaited leasehold overhauls, and direct financial relief on household energy costs.
These measures aim to address key issues in the housing sector, from providing greater security for private renters to tackling what the government describes as 'unaffordable' ground rents for leaseholders. For anyone involved in the property market, understanding these upcoming changes is crucial.
The Renters' Rights Act: A New Era for Tenants
One of the most transformative pieces of legislation is the Renters' Rights Act, which received Royal Assent in October 2025. Its core provisions will begin to take effect from 1 May 2026, fundamentally altering the private rental sector.
A cornerstone of the act is the outright ban on 'no-fault' Section 21 evictions, preventing landlords from ejecting tenants without a specific reason. This change is designed to provide much greater stability for renters. Furthermore, landlords will be restricted to increasing rent only once per year and will be barred from asking for more than one month's rent as an upfront deposit.
The law also abolishes fixed-term tenancies in favour of indefinite rolling contracts. Tenants will have the right to end their agreement by providing two months' written notice. Other critical protections include a halt to competitive bidding wars between prospective tenants and a prohibition on discriminating against those who receive benefits or have children.
Tenants will also gain a new legal right to request permission to keep a pet, which landlords cannot refuse unreasonably. Additionally, the introduction of a Decent Homes Standard for the private rented sector will compel landlords to address hazards like damp and mould within strict deadlines. Housing Secretary Steve Reed stated these measures were about "calling time" on rogue landlords.
Leasehold Reform: A Delayed but Pledged Overhaul
Major reforms to the leasehold system are also on the agenda for 2026, though the timeline has faced delays. The government has pledged to implement the Leasehold and Freehold Reform Act 2024 (LAFRA) and introduce further legislation to address what Florence Eshalomi, Chair of the Housing, Communities and Local Government Committee, called a "nightmare" for some homeowners.
The reforms aim to simplify and reduce the cost for leaseholders looking to extend their lease, purchase their freehold, or take over the management of their building. A key focus is tackling "unaffordable and unregulated ground rents."
However, the government has acknowledged the complexity of the task. Despite a promise from Steve Reed to publish a draft Commonhold and Leasehold Reform Bill before the end of 2025, Housing Minister Matthew Pennycook has confirmed it will now not appear until the new year. This delay has been met with disappointment from campaigners, who urge swift action to end uncertainty for leaseholders.
Direct Savings on Energy Bills and a New 'Mansion Tax'
In a move to alleviate cost-of-living pressures, Chancellor Rachel Reeves announced direct cuts to energy bills. From April 2026, the average household is set to save approximately £150 per year on their energy costs.
This saving will be achieved by scrapping the current Energy Company Obligation (ECO) scheme when it ends in March 2026, a levy which adds around £43 to typical bills. A temporary partial removal of another renewables obligation charge, which adds about £90 annually, will contribute to the reduction. Money expert Martin Lewis has confirmed the cuts will be reflected in the price cap from 1 April 2026.
At the other end of the market, the Chancellor unveiled a new high-value council tax surcharge, often referred to as a 'mansion tax'. While it takes effect in April 2028, the crucial valuation work will be conducted in 2026. Properties valued over £2 million will face an annual surcharge on top of standard council tax, with rates starting at £2,500 for homes worth between £2m and £2.5m, rising to £7,500 for properties valued at £5m and above.
These sweeping changes mark a significant shift in UK housing and household finance policy. For renters, the new rights promise greater security, while leaseholders await detailed reforms. For most households, the energy bill reduction will offer welcome relief, setting the stage for a transformative year in 2026.
