The Year of the Horse – new year, new hurdles and new risks for real estate

The Renters’ Rights Bill received Royal Assent on 27 October. Whilst certain provisions came into force on 27 December 2025, 1 May 2026 marks the commencement of the headline grabbing reforms. These changes include the abolishment of assured shorthold and fixed-term tenancies, the ban of section 21 “no-fault” evictions and the introduction of stricter, grounds-based possession rules.  The changes will be accompanied, later in the year, by enhanced standards for property management and tenant dispute resolution.

Akin to the “Canal Turn”, the Renters’ Rights Act, with only a six-month “run up”, will be a key tactical and logistical challenge for the private rented sector this year.

Keep an eye on our Renters’ Rights information hub for further developments.

Sticking with The Grand National theme, the Building Safety Act 2022 is undoubtedly the Becher’s Brook of the real estate world – imposing, unforgiving and requiring formidable skill and bravery to navigate!

Regulator reform

New regulations will come into force on 27 January following which the Building Safety Regulator (BSR) as a new corporate entity will assume all statutory functions currently held by the Health and Safety Executive in this capacity. This is an important first step towards establishing a single construction regulator. The BSR has made significant progress in tackling internal delays in approving Gateway 2 and 3 applications and we can be cautiously optimistic that 2026 will see the BSR deliver on its commitment to break the Gateway 2 bottleneck. That said, navigating the complex regulatory approval process and evidencing compliance with the competency regime will remain a challenge for developers in 2026. For further commentary see Breaking the bottleneck: Making the Building Safety Act work for you.

Second staircase requirements

From 30 September 2026, new residential buildings over 18m must include a second separately protected staircase (to improve evacuation and firefighter access) in order to obtain building control approval. This new requirement, which will reduce the net sellable floor areas of developments, could affect profitability and, in turn, the viability of schemes at the design stage. There are transitional provisions in place and there will be an added incentive to progress projects as quickly as possible to avoid having to go back to the drawing board (quite literally) – with schemes having to be re-designed to accommodate a second core.

Building Safety Levy

Hot on the heels of the second staircase requirement comes the introduction of The Building Safety Levy on 1 October 2026, a chargeable rate per square metre charged to residential developers which will be used to fund the remediation of defects in unsafe buildings. This levy will need to be factored into project financial modelling and again could mean that there is a surge in building control applications in efforts to avoid the levy liability.

Order in the court!

The Court of Appeal is due to hear the Upper Tribunal’s decision in Almacantar Centre Point Nominee No. 1 Ltd & Anor v de Valk & Ors which will provide further clarification on the definitions of cladding, cladding remediation, cladding systems and ‘unsafe’ under the BSA. 2026 will also deliver long awaited clarity for landlords and leaseholders alike on the issue of retrospectivity when the Supreme Court hears the appeals in the cases of Triathlon Homes LLP v Stratford Village Development Partnership and Adriatic Land 5 Limited v Long Leaseholders of Hippersley Point. For further commentary see Hippersley Point and Triathlon Homes: Court of Appeal draws retrospective line in the sand regarding recovery of costs under the BSA.

2026 is shaping up to be another pivotal year for building safety and the BSA is capable of unseating even the most experienced riders. To avoid a nasty fall keep up to speed with developments as they unfold here The Building Safety Act.

April 2026 will see a significant revaluation of business rates across England and Wales based on rental values as at 1 April 2024. It will be one of the largest rateable value increases that we have seen for some time with relatively few winners. Adding a sting to the tail is the complex new system of five multipliers and transitional schemes introduced by the Autumn Budget – a technical bear trap and an expensive one at that for most runners in the paddock.

Implementing the beginning of the end of the “feudal” leasehold system is proving a tricky hurdle to negotiate from a legislative perspective.

The Leasehold and Freehold Reform Act 2024 (LAFRA) received Royal Assent in May 2024, however not only are many provisions of LAFRA yet to be implemented but they have also been subject to legal challenge. In R (ARC TIME Freehold Income Authorised Fund & Others) v Secretary of State for Housing, Communities and Local Government [2025] EWHC 2751 (Admin), a consortium of major freeholders argued that the proposed changes to enfranchisement valuation were incompatible with Article 1 of Protocol 1 of the European Convention on Human Rights. The High Court ruled in favour of the Government, but the decision is likely to be appealed and as such, the Government is likely to adopt a very cautious approach to implementation in 2026.

Meanwhile, the Leasehold and Commonhold Reform Bill has fallen at the first hurdle. Promised at the end of last year, the bill which includes provisions for a ban on new leasehold flats, an invigoration of commonhold as a central focus and the capping of ground rents, never materialised and is now promised early this year. We will have to wait and see whether the promised bill, when published and therefore makes it over the first fence, strikes a practical and workable balance between collective ownership and effective management.

You can keep abreast of developments here Leasehold and Freehold Reform.

Security of Tenure – the second consultation of the LTA 1954

Last summer, the Law Commission released its provisional conclusions of the  2024/2025 consultation on Part 2 of the Landlord and Tenant Act 1954. We explained those conclusions in our article An interim update on security of tenure. Back in the saddle and onto the second lap, the second part of the consultation is expected to be published and released this spring and will focus on how the technical details of the 1954 Act and the procedure of contracting out could be modernised. It is however unlikely that this will be one that reaches the finish post this year. The contracting out procedure as we know it (complex, costly and not fit for purpose in the context of the present commercial leasing environment) seems set to stay for 2026.

The English Devolution and Community Empowerment Bill

The English Devolution and Community Empowerment Bill was a dark horse and caused quite the stir last July. Hidden within the Bill is the proposed ban of the inclusion of upward only rent review clauses in all new commercial leases (and leases that undergo statutory renewal). Our article Could this really be the end of the upward only rent review?  considered the possible impact of the Bill for landlords, investors and tenants alike. For a Bill of its size, it has been galloping through the Parliamentary process at impressive speed. This Bill could well cover the final furlong this year – all bets are on for this outside runner to receive Royal Assent in 2026.

Contractual Control agreements register

A pilot register of contractual control agreements is expected to go live in March this year and will be hosted by HM Land Registry. The register is part of the implementation of the housing market reforms introduced by The Levelling Up and Regeneration Act 2023. The public register will enable anyone to be able to find out who owns and perhaps more crucially controls land, whether this be through an option agreement, pre-emption rights, promotion agreements or conditional sale contracts. The intention of the register is to provide reliable information for communities, developers and public authorities. The register will not require contractual rights of individuals to be registered.   Whilst draft regulations have been published, identifying the information that will be lodged digitally, the detail of how the registration process will work is awaited and the devil is therefore in the detail which could well affect timescales for a full scale roll out.

Is the Year of the Horse also (finally) the year of commercial lease reform?

The Law Commission’s 14^th Programme of Law Reform, published in September 2025, includes ten projects aimed at modernising and simplifying the law of England and Wales. One project in the programme will focus on commercial leasehold, with the first part of the project considering reported issues with the Landlord and Tenant (Covenants) Act 1995. The second part will consider the rights of first refusal under the Landlord and Tenant Act 1987 (so far as the law relates to commercial premises). Since its introduction, the Landlord and Tenant (Covenants) Act 1995 has set a demanding course for practitioners, landlords, tenants and investors alike, with lease assignment, guarantors and transaction structuring presenting complexity and frustration. The timetable for each project within the reform programme will be announced shortly.

Charging Ahead: The new Valuation Framework enters the race for telecoms

Key provisions of the Product Security and Telecommunications Infrastructure Act 2022 will come into force on 7 April 2026. For our previous thinking on the Code and Code rights, see Proposed changes to the 2017 Electronic Communications Code and Changes to the Electronic Communications Code. This year’s legislative changes will bring the renewal of existing agreements entered into before 28 December 2017 and that are subject to Part 2 of the Landlord and Tenant Act 1954 into line with the framework adopted under the Code.

Trocadero (2015) LLP v Picturehouse Cinemas Ltd and other companies [2025] EWHC 1247 (Ch)

Last year, in our article Insuring trouble: What landlords must learn from the Trocadero high court ruling we examined the judgment in London Trocadero (2015) LLP v Picturehouse Cinemas Ltd and others. The ruling sent a clear warning to landlords who recover insurance commissions from tenants under commercial leases. The Landlord’s appeal is scheduled for hearing on 3 June 2026 and will likely place focus once again on landlord practices, the transparency of insurance (and other leasehold) charges, the construction of lease terms and may indeed have broader implications for commercial lease agreements and broker relationships.