Latest research: The Renters' Rights Act and the Brazilian Allocator

Read at superprimeinternational.com/insights/renters-rights-act-2025

The prime London lettings market is splitting in two. The Renters’ Rights Act is the accelerant. For Brazilian principals with London exposure, the old playbook no longer applies.

One

The Market Signal

The Beauchamp Estates Millionaires Letting in London Survey 2026 recorded a 57.9% rise in super-prime lettings between £10,000 and £20,000 per week, even as the wider prime central London market contracted by 372 deals and £23 million in transaction value.1 The two signals point in opposite directions because two different markets are now operating under one postcode.

This is not coincidence. It is a regulatory and tax-driven repricing of landlord risk, tenant behaviour, and liquidity preference. The Renters’ Rights Act, with its primary provisions taking effect on 1 May 2026, is the accelerant.2 It does not create the entire shift, but it changes the operating framework through which landlords, tenants, advisors, and family offices must now interpret the market.

For Brazilian UHNW principals with London exposure, the implication is direct. A prime central London apartment held as a buy-to-let is no longer governed by the same flexibility assumptions that shaped previous cycles. A super-prime rental used as a pre-acquisition strategy, by contrast, may now sit in a structurally advantaged segment. The market is not simply tightening. It is separating.

Savills’ Q1 2026 Prime London Lettings Index recorded modest headline growth: prime central London rents rose 0.5% quarter-on-quarter and 1.1% year-on-year, while outer prime London rose 0.7% quarter-on-quarter and 2.3% year-on-year.3 The sub-segment detail is more revealing. Within prime central London, rents below £1,000 per week rose 3.3% over the year, while homes at £2,000 per week and above recorded small falls.4

Supply is contracting. 62% of Savills agents saw rental stock fall in the three months to Q1 2026, with stock migrating into the sales market. New listings across prime central and outer London in January 2026 were 13% below the five-year average and one-third below January 2019 levels.5 Jessica Tomlinson of Savills attributed the pattern to higher costs, increased regulation, and taxation pushing privately rented stock, particularly among smaller debt-dependent landlords, into the sales market.6

Beauchamp Estates’ 2026 survey sharpens the picture. Total prime central London lettings above £1,000 per week fell from 3,814 deals in 2024 to 3,442 in 2025, a 9.7% decline in volume and a 6.1% drop in value. Yet the super-prime band between £10,000 and £20,000 per week rose from 19 deals to 30, with annual income climbing from £12.7 million to approximately £20 million.7 Jeremy Gee of Beauchamp Estates attributed the wider contraction to landlord concerns over the Renters’ Rights Act and tax changes, and the super-prime counter-trend to non-dom abolition and stamp duty costs.8

Chestertons’ 2026 forecast projects 2% rental growth across Greater London and up to 3% in prime central London, with housing costs already consuming around 40% of household income at the end of 2025.9 The firm also noted that the Act’s restriction on accepting offers above asking price may push advertised rents slightly higher at the outset.10

The data suggests the market is already pricing in the Act. Lower and mid-prime landlords are re-evaluating exposure. Super-prime tenants are accepting high rental costs as a liquidity strategy. Supply is tightening where regulation bites hardest.

Two

The Regulatory Shift

The Renters’ Rights Act 2025 received Royal Assent on 27 October 2025. Primary provisions come into force on 1 May 2026 and apply across England, including high-value prime residential properties held under assured tenancies.11

End of Section 21 and mandatory periodic tenancies. From 1 May 2026, landlords can no longer use Section 21 “no-fault” notices to recover possession without giving a reason. Possession must be pursued through Section 8 grounds, supported by a statutory basis.12 At the same time, fixed-term assured shorthold tenancies are abolished. Existing fixed-term ASTs convert automatically into assured periodic tenancies, and new fixed-term ASTs of under 21 years can no longer be granted. Tenants may leave at any time with two months’ notice. Landlords lose the certainty of a contractual end date.13 Valid Section 21 notices served by 30 April 2026 remain actionable, but proceedings must begin by 31 July 2026.14

One-month rent-in-advance cap. For new tenancies from 1 May 2026, landlords may not accept rent before the agreement is signed, and may collect only one month’s rent in advance thereafter.15 This is highly material in the prime market. Six or twelve months upfront has been common where tenants are international, recently relocated, or unable to satisfy conventional UK referencing. The cap does not apply to existing pre-1 May tenancies with larger rent-in-advance provisions already in place.16

Bidding prohibition. From 1 May 2026, landlords and their representatives must publish a specific proposed rent and may not invite, encourage, or accept offers above the advertised asking rent.17 The rule changes pricing behaviour. In constrained micro-markets, landlords may set advertised rents more defensively, because the offer process can no longer correct underpricing through competitive bids.

Pet rules. Every assured tenancy now includes an implied right for tenants to request permission to keep a pet. Blanket prohibitions are unenforceable. Landlords must respond within 28 days and may refuse only on objectively reasonable grounds, such as a superior lease prohibition or genuine property unsuitability.18 The materiality is operational: prime flats in mansion blocks and leasehold buildings will need careful review of head leases and management restrictions.

Three

The Non-Dom Compound

The Renters’ Rights Act does not sit in isolation. It arrives after the April 2025 replacement of the non-dom regime with the Foreign Income and Gains regime.19

The FIG regime provides a four-year exemption from UK tax on foreign income and gains for qualifying new residents with at least ten consecutive tax years of prior non-UK residence.20 That relief does not extend to UK rental income. UK rental income is UK-source income arising from a UK asset, and it remains fully taxable in the UK under the Non-Resident Landlord Scheme or Self Assessment, regardless of domicile or FIG status.21

This distinction matters for international holders. The April 2025 reform changed the tax treatment of foreign income and gains for qualifying individuals. It did not create a shelter for UK rental profits.

The combined effect of tax and tenancy reform is producing three observable behaviours. First, some mid-prime landlords are exiting to the sales market rather than absorbing the combined effect of regulation, tax, and reduced tenancy control.22 Second, former non-dom owners are increasingly appearing on the demand side of the rental market, retaining a London presence through lettings rather than ownership.23 Third, super-prime tenancies are increasingly structured through arrangements that sit outside the assured tenancy framework. Where annual rent exceeds £100,000, the tenancy is expressly excluded from the Housing Act 1988 regime and from the Act’s provisions entirely.24 At £10,000 per week and above, every tenancy clears that threshold. The regulatory exemption provides structural confidence at the top of the market that no longer exists below it.

Four

The Brazilian Framework

For Brazilian UHNW principals, the correct response depends on what role London property plays in the family balance sheet.

The first archetype is the Brazilian family holding a prime central London flat as a buy-to-let. Exposure is real. Existing tenancies need review before 1 May 2026. The family should understand periodic conversion, the loss of fixed-term certainty, the reduced practicality of upfront rent, the new limits on rental competition, and the operational implications of pet requests. The asset may remain valid. The landlord playbook that worked in previous cycles does not.

The second archetype is the Brazilian family acquiring for own-use or for a child at university. Direct RRA exposure is limited where the property is not let under an assured tenancy. Indirect exposure is still relevant: exit timing, rental fallback strategy, and future liquidity may be shaped by broader stock migration and altered buyer behaviour in specific micro-markets.

The third archetype is the Brazilian family considering a super-prime rental above £10,000 per week as an entry strategy before buying. This segment is moving with strength. It offers residence, optionality, and market intelligence before capital is committed. Where properly structured, the rental period becomes a legitimate pre-acquisition phase rather than a sunk cost.

For cross-border allocators, the question is no longer whether London remains attractive. It is which part of London, under which tenancy structure, with what exit path.

Five

The Thesis

The Renters’ Rights Act is not a disruption to avoid. It is a structural shift to navigate. Brazilian allocators with a cross-border perspective may read the London market more clearly than domestic landlords under pressure, because they can weigh taxation, liquidity, mobility, and optionality rather than rental yield alone. The advantage now belongs to those who understand the split before it is fully priced.

SPI Private Advisory

Structural Review. Before 1 May.

For Brazilian UHNW principals and family offices reviewing London rental exposure ahead of the Renters’ Rights Act taking effect, Super Prime International offers confidential pre-commencement review and structural advisory.

Sources

Beauchamp Estates, Millionaires Letting in London Survey 2026, February 2026.
GOV.UK / MHCLG, Guide to the Renters’ Rights Act, November 2025; Mishcon de Reya LLP, A Guide to the Renters’ Rights Act 2025, February 2026; Forsters LLP, The Renters’ Rights Act 2025 Explained, April 2026.
Savills, Q1 2026 Prime London Lettings Index, April 2026.
Savills, Q1 2026 Prime London Lettings Index, April 2026.
Savills, Q1 2026 Prime London Lettings Index, April 2026.
Jessica Tomlinson, Savills Research Analyst, Q1 2026 Prime London Lettings Index, April 2026.
Beauchamp Estates, Millionaires Letting in London Survey 2026, February 2026.
Jeremy Gee, Managing Director, Beauchamp Estates, quoted in Millionaires Letting in London Survey 2026, February 2026.
Chestertons, 2026 Rental Forecast, December 2025.
Chestertons spokesperson, 2026 Rental Forecast, December 2025.
GOV.UK / MHCLG, Guide to the Renters’ Rights Act, November 2025; Mishcon de Reya LLP, February 2026; Forsters LLP, April 2026.
GOV.UK / MHCLG, Guide to the Renters’ Rights Act, November 2025; Mishcon de Reya LLP, A Guide to the Renters’ Rights Act 2025, February 2026.
Forsters LLP, The Renters’ Rights Act 2025 Explained, April 2026.
Mishcon de Reya LLP, A Guide to the Renters’ Rights Act 2025, February 2026.
GOV.UK / MHCLG, Guide to the Renters’ Rights Act, November 2025.
Mishcon de Reya LLP, A Guide to the Renters’ Rights Act 2025, February 2026.
GOV.UK / MHCLG, Guide to the Renters’ Rights Act, November 2025; Forsters LLP, April 2026.
Forsters LLP, The Renters’ Rights Act 2025 Explained, April 2026.
Low Incomes Tax Reform Group, Foreign income and gains from 6 April 2025, 5 April 2025; Macfarlanes, UK non-dom reforms, 6 April 2025.
Charles Russell Speechlys, A new chapter for new arrivals: the FIG regime and long-term residents, 29 March 2026.
HMRC / GOV.UK, Non-resident Landlords Scheme guidance notes, updated 2025; Low Incomes Tax Reform Group, Non-resident landlord scheme, updated 5 April 2025.
Savills, Q1 2026 Prime London Lettings Index, April 2026.
Knight Frank, Non-Doms Leave London but Keep Property Options Open, July 2025; Beauchamp Estates, Millionaires Letting in London Survey 2026, February 2026.
Withers LLP, The Renters’ Rights Act 2025, March 2026; Mishcon de Reya LLP, A Guide to the Renters’ Rights Act 2025, February 2026.