What the end of fixed-term tenancies actually means for your income
Three months on from 1 May 2026, most London landlords know what changed. Far fewer have been told what it does to the shape of their income — and that one fixed-term contract is still available to them.
Three months on from 1 May 2026, most London landlords now know what changed. Fixed terms are gone. Section 21 is gone. Every assured shorthold tenancy in England converted automatically to a periodic tenancy on the commencement date, and no new tenancy can carry a fixed term.
What far fewer landlords have been told is what that does to the shape of their income.
This is not a legal explainer. There are hundreds of those, and the NRLA’s is better than anything we could write. This is about the thing the legal explainers skip: the money — and, at the end, the one fixed-term contract still available to you.
Your income is no longer annual. It is monthly, and it renews twelve times a year.
Under the old model, a twelve-month AST gave you a contractual floor. A tenant who wanted to leave in month four had a problem, not you. You could look at a spreadsheet in January and know, with reasonable confidence, what the property would produce by December.
That floor no longer exists.
A tenant on a periodic tenancy can serve two months’ written notice at any point, including in the first week, and there is no minimum period they have to wait. The notice has to be in writing and has to expire at the end of a rental period, but that is the only real constraint on them.
Practically, this means your annual income is now a chain of monthly renewals, and the tenant holds an option to break that chain at every link. Nothing about your property has changed. What has changed is that the certainty you used to buy with a signature now has to be earned every month instead.
The consequences most landlords haven’t priced in yet
Voids are no longer seasonal — they’re random.
The old market had a rhythm. Fixed terms clustered around the same few months, which meant re-lets clustered too. You knew roughly when your property would be back on the market, and so did everyone else, and you planned around it: the decorator booked, the inventory scheduled, the marketing live four weeks out.
Periodic tenancies dissolve that rhythm. Notice can land in November, when London’s rental market is at its slowest and time-to-let stretches. It can land while you’re abroad. It can land on two properties in the same fortnight.
The cost isn’t the void itself — it’s that you can no longer prepare for it. A void you saw coming eight weeks out is a scheduling problem. A void you find out about on a Tuesday is a cash problem.
Getting the property back is now a process, not a date.
Section 21 gave you an exit that required no reason. It’s gone. Every route to possession now runs through a statutory ground, and every ground is contestable in court.
If you need the property back to sell it or to move in, you’re looking at four months’ notice and you cannot serve it within the first twelve months of the tenancy. On serious arrears, the threshold is now three months unpaid. Possession claims in England were already averaging over six months before Section 21 was removed; nobody sensible expects that to have got faster.
The practical consequence: problems that used to be solvable at the end of a fixed term now have to be solved during the tenancy, or not at all.
Your agent’s incentives have quietly changed — and it may not be in your favour.
Renewal fees were a meaningful share of letting agency revenue in London. Under the new regime, there is no renewal to charge for.
Some agents will absorb that. Some will look to replace the income elsewhere — higher management percentages, rebadged administration charges, or a quiet preference for churn, because a new tenancy still generates a tenant-find fee where a continuing one generates nothing.
It’s worth asking your agent directly what the removal of renewal fees has done to their revenue, and what they’ve done about it. The answer tells you a lot.
Retention is now the entire game.
When the tenant can leave at any time and you can’t easily get the property back when you want it, the only variable you genuinely control is whether the tenant wants to stay. Not whether they’re contractually stuck — that lever is gone — but whether the flat is well maintained, whether the boiler gets fixed in two days rather than two weeks, whether somebody answers the phone.
Tenant satisfaction used to be a nice-to-have. It is now the primary driver of your income stability, and a lot of the industry hasn’t caught up.
What we’d do if this were our property
Three things, in order.
Move your income planning from annual to rolling. Stop forecasting on twelve-month rent totals. Forecast on a rolling basis with a realistic void assumption built in — for most London stock, two to four weeks per turnover. If your numbers only work at 100% occupancy, they don’t work.
Build a maintenance response standard and hold to it. Not because it’s virtuous, but because it’s now the cheapest form of income protection available to you. A repair handled in 48 hours costs the same as one handled in three weeks. Only one of them makes the tenant think about moving.
Know when your compliance expires — all of it, on one page. Gas safety, EICR, licensing, deposit protection, and the written information requirements the Act introduced. Under the old regime a compliance gap was an administrative problem. With Section 21 abolished, a compliance gap can become an obstacle to possession.
There is still one fixed-term contract available — and most landlords are never told about it
Everything above applies to the ordinary kind of tenancy — the one you grant to an individual who lives in the property as their home. That’s what the Act reformed, and it covers almost every private letting in England.
There is one arrangement it doesn’t reach: letting to a company.
When your tenant is a limited company rather than a person, the residential tenancy rules don’t apply. What matters is who the tenant is, not who the landlord is — you can be a private individual and still let to a company. The agreement is a commercial contract. Fixed terms remain available. The two-month tenant notice doesn’t apply.
This isn’t a loophole somebody found after the Act passed. Company lets have been used for decades — they’re how NHS trusts, universities, relocation firms and corporate employers have always housed people — and the Act was never written with them in mind. Nothing about them changed on 1 May.
Which means fixed terms are still available to you.
What that looks like with Co-Lux
Co-Lux Living is not your letting agent. We are your tenant.
Our company signs the agreement. Our company is named on it, liable under it, and you get paid every single month.
The practical effect for you:
A genuine fixed term
We contract for up to five years. That term is enforceable in the ordinary way, because it isn’t an assured tenancy and nothing in the Act touches it. You get back the planning horizon the Act removed from everybody else.
The rent arrives every month regardless of occupancy
Our obligation to pay you is contractual and unconditional. It does not depend on whether a room is let, whether an occupier has given notice, whether somebody has fallen into arrears, or whether the market has softened. If a room sits empty, that is our problem and our cost. It never reaches your bank statement.
No voids. No tenant-find fees. No management fees. No renewal fees.
There is no agent in the middle taking five weeks’ rent every time somebody moves. As our article on the true cost of a void sets out, turnover costs consume roughly a third of a typical London landlord’s net return across five years. Under this structure, that entire category of cost leaves your side of the ledger.
The property is looked after to a standard, at our cost
We furnish, maintain and clean it throughout the term and fund the day-to-day work of keeping it that way. Where a traditional agent charges you a monthly percentage for a managed service, that management is included here at no cost to you — we’re the tenant, not your agent. And our business only works if the property is somewhere people actively want to live, so our interest in its condition is the same as yours — not for the length of a tenancy, but for the length of the contract.
One point of contact, and one that doesn’t change
No tenant referencing to approve, no viewings to accommodate, no calls at nine on a Sunday. The property is inspected and maintained to an agreed standard throughout the term and returned to you in the condition set out in the agreement.
The honest part
We’d rather tell you the trade-offs now than have you discover them on a call.
Some responsibilities stay with you. Handing over the day-to-day doesn’t hand over ownership. Safety certificates still need to be valid and renewed when they fall due, and the structure and fabric of the building remain yours. We track every expiry date and tell you well ahead of anything lapsing, and the agreement sets out clearly which of us arranges and pays for what — but the underlying obligations of owning a rented property don’t transfer, and we’d rather you heard that from us than found it out later.
Not every property suits this. We’re specific about layout, size, condition and location, and we decline more properties than we take. A property that doesn’t work as professional shared accommodation is one we’d be wrong to commit to for five years — and a five-year rent obligation isn’t something we offer lightly.
Why we’re comfortable carrying the risk you’d rather not
Because we’ve been operating under these conditions for more than a decade, long before the Act made them universal.
Our rooms have always been let on rolling terms. We’ve never had a twelve-month contractual floor, never been able to plan a re-let around a known end date, and never had certainty of income we didn’t build ourselves. So we built the operation for it, and then spent ten years refining it: notice triggers marketing immediately rather than at move-out, compliance sits in a tracked system with expiry dates rather than in somebody’s memory, and maintenance is triaged quickly and efficiently, with tenants logging and tracking every issue through the tenant app.
Behind that sits infrastructure most operators our size simply don’t have — a dedicated office, in-house administration, compliance and finance teams, our own operations platform, and people who have spent their careers in London shared accommodation rather than a couple of years. Every part of it has been rebuilt more than once, because ten years of operating teaches you where a process breaks long before a spreadsheet does.
That’s now the operating model the law requires of every landlord in England, and we’ve been running it across close to 300 units in West and South West London. It’s the reason a five-year rent commitment is something we can offer with confidence rather than optimism.
Which is the whole proposition, really. You can build that operation yourself. Or you can let the property to somebody who already has.
A fifteen-minute call and a real number
Including an honest comparison against what you’d make letting it conventionally. No fee, no obligation.
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