London — The Government has confirmed that new rules under the Renters’ Rights Act will prevent landlords from evicting tenants to convert their properties into holiday lets, as a Labour MP calls for further action to clamp down on short-term lets, and the wider rental reform package prepares to take effect on 1 May 2026.
The confirmation came in a written parliamentary answer from Baroness Taylor of Stevenage, Parliamentary Under-Secretary of State for Housing, in response to a question from Lord Truscott on when the Government plans to introduce legislation to regulate short-term let properties.
The Renters’ Rights Act received Royal Assent on 27 October 2025. The first and most significant phase of reforms, including the abolition of Section 21 no-fault evictions, comes into force on 1 May 2026, representing the biggest overhaul of the private rented sector in a generation.
What the Renters’ Rights Act Does on Holiday Lets
Under the Act, Paragraph 8 removes Ground 3 from Schedule 2 of the Housing Act 198, the legal mechanism that previously allowed landlords to evict tenants to let their properties during periods of high tourist demand.
The Act’s explanatory notes set out the rationale directly: “Ground 3 of Schedule 2 of the Housing Act 1988 requires the court to award possession if, at some time in the 12 months prior to the tenancy starting, the dwelling-house was used as a holiday let. In practice, this ground facilitated seasonal holiday let properties that would be let out as a holiday let over the summer and to a private tenant for the rest of the year.”
The removal of Ground 3 means that courts will no longer be required to grant possession on this basis. As the notes confirm: “This will prevent landlords from evicting tenants from properties out for short periods of high tourist demand.”
Government Sets Out Wider Package of Measures
In her written answer, Baroness Taylor acknowledged that short-term lets can have a damaging effect on housing availability in certain parts of the country.
“Whilst second homes and short-term lets can benefit local economies, the government appreciate that excessive concentrations in some areas of the country can impact the availability and affordability of homes, both to rent and buy,” she said.
She outlined the package of measures introduced alongside the Renters’ Rights Act provision:
- Abolition of the furnished holiday lets tax regime, removing the financial incentive for landlords to prioritise short-term holiday lets over longer-term tenancies — a change that took effect in April 2025
- An increase in the higher rates of Stamp Duty Land Tax on additional dwellings to five percentage points above standard rates
- The Department for Culture, Media and Sport is progressing a national registration scheme for short-term lets in England, expected to go live in 2026 — potentially from April — though it may involve an initial voluntary stage before becoming mandatory.
The Government has also announced a consultation on new powers for regional Mayors to impose an overnight levy on holiday lets.
The Furnished Holiday Let Tax Change — Already in Effect
The abolition of the furnished holiday lets tax regime in April 2025 removed one of the most significant financial incentives for landlords to opt for short-term letting over long-term tenancies.
Previously, furnished holiday let income was exempt from the Section 24 finance rules, meaning owners could still claim full tax relief on their financing costs, an advantage not available to standard buy-to-let landlords. Since April 2025, that exemption no longer applies,s and short-term let income is now taxed the same as standard business property income.
Other changes included the removal of capital allowances for new expenditure, the withdrawal of access to tax reliefs on chargeable gains for trading business assets, and the end of this income being included in relevant UK earnings for pension relief calculations.
To qualify as a furnished holiday let in England, a property must have been available to let for at least 140 nights over the past 12 months and actually let for at least 70 of those nights. Properties that fail to meet these criteria automatically incur a council tax bill rather than business rates. In London, a separate 90-day rule applies, meaning properties can only be let for short-term accommodation for up to 90 nights per year without specific planning permission for change of use.
What Changes on 1 May 2026
The holiday let provisions sit within a far broader package of reforms taking effect on 1 May 2026. From that date, fixed-term assured shorthold tenancies will be abolished for both new and existing private tenancies in England and replaced with assured periodic tenancies, rolling agreements with no end date, meaning tenants can stay in their home until they decide to end the tenancy by giving two months’ notice.
Section 21 no-fault evictions will be abolished, and reformed grounds for possession under Section 8 will apply. Landlords will also be prohibited from inviting, encouraging, or accepting offers above the advertised asking rent, and it will become illegal to discriminate against prospective tenants who receive benefits or have children.
Landlords must provide tenants with a copy of a Government information sheet explaining the new tenancy rules by 31 May 2026. The Government has allocated £18.2 million to local authorities in 2025/26 to help them implement the Act.
Any Section 21 notice served before 1 May 2026 remains valid, but landlords must begin court possession proceedings on or before 31 July 2026 under transitional provisions.
From late 2026, a new Private Rented Sector Database will begin to be rolled out, requiring all landlords of assured and regulated tenancies to register themselves and their properties. Failure to register could result in civil penalties of up to £7,000. A new ombudsman service for the private rented sector is expected to be ready in 2028.
Calls to Go Further on Data and Enforcement
The announcement comes as a Labour MP has called on the Government to go further on short-term lets by changing data-management rules, arguing that current data-sharing arrangements between platforms such as Airbnb and local authorities are insufficient to enforce existing regulations effectively.
The pressure to act on short-term lets has grown considerably in recent years, driven by evidence that platform-driven holiday letting has reduced long-term rental supply in tourist hotspots and coastal communities, pushing up rents and making it harder for local workers and families to find affordable homes.
The issue is being felt across Europe. The European Parliament passed the EU’s first-ever housing plan this month, a package that includes measures to discourage the surge in short-term holiday lets across tourist hotspots in the bloc. In Ireland, campaigners from TINTEÁN have warned that Airbnb growth at twice the national average is threatening Irish-speaking Gaeltacht communities, with 112 Airbnb listings recorded in Dingle against zero long-term rentals on Daft.ie, as part of Ireland’s wider housing crisis.
Meanwhile, landlords across England are already issuing last-minute Section 21 eviction notices ahead of the 1 May ban — with tenants reporting sudden removals and fears of homelessness as the Renters’ Rights Act approaches.
For the latest on the UK housing crisis, landlord and tenant rights and Irish housing policy, visit M10News.com.
This is a developing story. Updates will follow as more facts are confirmed.
