Preparing for exemption

On 1 May 2026, the first phase of the Renters’ Rights Act’s (the act) reforms will come into force, including the introduction of the new assured periodic tenancy regime. Assured shorthold tenancies (ASTs), the most common type of tenancy in the private rented sector (PRS), will convert to open-ended assured periodic tenancies (APTs). Fixed terms will be abolished, along with the section 21 possession procedure. 

Private purpose-built student accommodation (PBSA) that meets certain criteria will be exempt from the changes and will fall outside the assured tenancy framework. PBSA will move in line with university accommodation, as landlords will be able to grant students common law tenancies. This has advantages for student landlords, as tenancies can be granted with fixed terms that align with the academic calendar and rent can be taken in advance. Further, at the end of the fixed term, landlords can regain possession without needing to prove a statutory ground for possession. A court order is still required, but the process is typically more straightforward than using the grounds-based section 8 procedure under the assured tenancy regime.

This article will examine the ‘PBSA exemption’ in the act, what it means for existing and prospective student contracts and what PBSA providers can be doing now to prepare for implementation on 1 May 2026.

What is the ‘PBSA exemption’?

The exemption framework is contained in section 32 of the act. It amends the power at paragraph 8 of schedule 1 to the Housing Act 1988 that excludes certain lettings to students from assured tenancy status. This is the exemption that allows universities to fall outside the assured tenancy regime now. The act amends the exemption to allow for a wider range of non-educational providers of student accommodation to fall within scope.

Section 32 of the act came into force on 27 December 2025. However, the act requires the secretary of state to make regulations to implement the exemption. The government has set out in its implementation roadmap that the statutory instrument exempting qualifying PBSA from the assured tenancy regime will come into force on 1 May 2026 when the new tenancy regime takes effect.

Statutory framework

The amended paragraph 8 of schedule 1 to the Housing Act 1988 requires a tenancy which is granted to a person who is pursuing, or intends to pursue, a course of study provided by a specified educational institution. This means a tenancy to a student or an intended student at a university or college that is specified in regulations. 

Then, either:

1. The tenancy is granted by that institution, by another specified educational institution or by a specified body of persons (‘specified’ means specified by regulations which may specify as a body of persons the members or class of members of a specified housing management code of practice), or 
2. One of the following is a member of a specified housing management code of practice:
   • A person appointed to act on the landlord’s behalf in respect of the tenancy, or
   • A person appointed to discharge management functions in respect of the building which comprises the dwelling-house or in which the dwelling-house is situated. ‘Management functions’ is defined in the act as including functions relating to the provision of services or the repair, maintenance, improvement or insurance of the building.

Therefore, the regulations can specify that both landlords and agents will benefit from the exemption, provided they are members of a specified housing management code of practice. The regulations will set out the detail, and the secretary of state has the power to specify a class of building that will be exempt and/or restrict the exemption to certain categories of buildings in relation to specified student landlords or specified persons acting on their behalf. For example, the exemption could be restricted to buildings designed as PBSA which are subject to the housing code of practice where the landlord or agent is also a member of the code.

What is a specified housing management code of practice?

This is defined in the act as a code of practice approved by the secretary of state under section 233 of the Housing Act 2004. For non-educational establishments, the current approved code is the ANUK/Unipol National Code (the code) for accommodation owned or managed by non-educational establishments. While the code will still need to be specified in regulations for the purpose of the exemption, the government’s intention is for the exemption to be tied to membership of the code. 

In anticipation of the act’s changes, the code underwent an interim review last year. A summary of the proposed changes to the code can be found on the National Code’s website, where it is also stated that the revised code is awaiting government approval and will be introduced from 1 May 2026. Final details of the new code are expected to be made available to members in early spring 2026 (see National Code news updates from 16 September 2025, 18 November 2025 and 6 January 2026). 

To benefit from the exemption, the applicant will need to meet the code’s entry criteria. Details can be found on the National Code’s website but includes the requirement that each building must have a minimum of 15 bed spaces. Smaller houses in multiple occupation (HMOs) are not eligible for membership.

Impact on student contracts for the 2025/2026 academic year

The tenancy reforms will come into force on 1 May 2026 before the end of the current 2025/2026 academic year. It is understood that the PBSA exemption will not apply retrospectively to tenancies already in existence on 1 May 2026, but only to new tenancies granted on or after this date. This means on 1 May 2026, current student ASTs will convert to APTs with the rest of the PRS. Fixed terms will disappear and students will have open-ended, ‘rolling’ contracts. Providers will need to be aware that a student with an APT can serve a notice to quit, terminating the tenancy. The notice to quit will need to give at least two months’ notice (unless a shorter period is agreed with the landlord, in writing) and will need to comply with the common law rule that it expires on the last or first day of a rental period. Any rent paid for days after the end of the tenancy would need to be refunded (section 14ZC of the Housing Act 1988, added by section 10 of the Renters’ Rights Act 2025). The only exceptions to ASTs converting to APTs on 1 May is if there is a valid section 21 or section 8 notice pending and the landlord acts in accordance with the transitional provisions in schedule 6 of the act. This is discussed further below. 

The act contains special provisions for existing tenancies. For example, there is a carve-out for existing tenancies from the act’s prohibitions on asking for rent in advance (section 4B(2)(a) of the Housing Act 1988, added by section 8 of the  Renters’ Rights Act 2025). Providers will not need to refund rent if current tenants have already paid upfront, or move to collecting rent monthly when the tenancy converts to an APT. 

Like other PRS tenancies converting to APTs on 1 May 2026, PBSA landlords will be under a duty to give tenants a copy of the government’s information sheet on or before 31 May 2026, informing them of the changes made by the act (schedule 6, paragraph 7(2) and 7(3) to the Renters’ Rights Act 2025). The government has said this will be published online in March 2026. This must not be overlooked, as there are penalties for failing to comply with this duty; providers could be issued with a civil penalty of up to £7,000 by the local authority for non-compliance.

Recovering possession

The act contains additional transitional provisions for qualifying PBSA providers to assist with recovering possession of properties as they move out of the assured tenancy regime. Where there is a ‘qualifying student tenancy,’ a modified ground 4A, the new mandatory student possession ground, is available. An existing tenancy is a ‘qualifying student tenancy’ if any of the following is a member of a specified housing management code of practice:

• the landlord
• a person appointed to act on the landlord’s behalf in respect of the tenancy, or
• a person appointed to discharge management functions in respect of the building which comprises the dwelling-house or in which the dwelling house is situated (schedule 6, paragraph 13(3) to the Renters’ Rights Act). This essentially refers to PBSA tenancies.

Ground 4A applies to properties let to full-time students where the landlord requires possession to re-let to students on the next occasion; in other words, the next academic year. It contains a list of conditions that must be met for the landlord to use the ground (schedule 2 to the Housing Act 1988, as amended by the Renters’ Rights Act 2025). These conditions are less restrictive for qualifying student tenancies. For example, the property does not need to be an HMO, so it may be used for studios occupied by one or two tenants, and the requirement for the section 8 notice to expire between 1 June and 30 September does not apply (see schedule 6, paragraph 13(2)(b), to the Renters’ Rights Act 2025). To rely on this ground, the landlord must give the tenant a written statement of their wish to be able to recover possession using the ground on or before 31 May 2026 (schedule 6, paragraph 13(1), to the Renters’ Rights Act 2025). Under the transitional arrangements for existing tenancies, the restriction on using the ground if the tenancy was entered into more than six months before its start date, does not apply (schedule 6, paragraph 13(1), to the Renters’ Rights Act 2025).

The notice period for ground 4A in the act is four months, but the government has recently changed its landlord guidance on ending a tenancy (Renting out your property: guidance for landlords and letting agents, Ministry of Housing, Communities and Local Government), to state that for student tenancies signed before 1 May 2026, the landlord can serve notice between 1 May 2026 and 31 July 2026, giving two months’ notice instead of four months. At the time of writing, the transitional regulations containing this temporary notice period reduction have not been published. Once available, providers will need to check applicability to their tenancies. 

PBSA providers will also want to consider whether the landlord can rely on a section 21 notice before this procedure is abolished. Landlords have up until 1 May 2026 to serve a section 21 notice. Provided the notice is valid (it complies with all the conditions for serving a valid section  21 notice), the landlord then has until 31 July 2026, or until the six-month notice limitation period expires, if earlier, to request the court to issue a possession claim (schedule 6, paragraph 4, to the Renters’ Rights Act 2025). This time period is referred to in the act as the ‘applicable period.’ The advantage of serving a notice is that the tenancy will not convert to an APT but remain an AST until the section 21 notice ceases to be valid. A notice will remain valid until the end of the applicable period or until the conclusion of possession proceedings, if the landlord has requested issue of the claim before the end of the applicable period.

Therefore, where existing contracts are due to end in June or July 2026, it may be beneficial to serve a section 21 notice before 1 May 2026 so that the tenancy can remain a fixed-term AST to the contract end date, at which point the tenant is likely to move out and the tenancy terminate. If the student does not move out, then the landlord will have until the end of the applicable period, and at most, until 31 July 2026, to commence section 21 possession proceedings. 

However, section 21 notices will not be appropriate for all 2025/2026 tenancies as it will not be possible to serve a valid section 21 notice in respect of a tenancy where the fixed term is due to end after the cut-off date of 31 July 2026. The landlord may instead need to rely on the new ground 4A and serve a section 8 notice if they need to recover possession. Therefore, different approaches may be needed for contracts ending before and after 31 July.

Considerations for the 2026/2027 academic year

Bookings for the next academic year are normally well underway at this point in the year, but PBSA providers who anticipate they will fall within the exemption may have decided to hold off granting tenancies for the 2026/2027 academic year until the exemption comes into force and they can grant common-law tenancies.

Providers taking bookings for the next academic year will need to be careful about how they communicate the act’s changes to students. If providers are taking payment from students to reserve rooms pending the grant of a tenancy, they will need to ensure they comply with the Tenant Fees Act 2019 and only take payments permitted by that legislation.

Consideration will also need to be given to existing tenants who wish to stay for another year, particularly those who remain in occupation and do not move out over the summer break. Once a student’s tenancy converts to an APT on 1 May 2026, it will continue until it is ended either by the tenant serving a notice to quit, the parties agreeing a mutual surrender or the landlord recovering possession. A student with an APT has the right to continue to occupy on that basis and may wish to do so to take advantage of the flexibility afforded by the assured periodic regime. Providers will need to be careful about how they communicate the transition to students, so they do not fall foul of the prohibitions in the act regarding bringing tenancies to an end. For example, a provider cannot insist that a student with an APT give up that tenancy and enter into a common law tenancy for the next academic year. Negotiations may need to be had with tenants already in occupation.

The transition period for PBSA providers is complex and, depending on each provider’s particular arrangements, may extend beyond the current academic year. The regulations, once published, will need to be considered carefully, including any further transitional provisions that may apply.

What PBSA providers can be doing now to prepare

PBSA providers planning for the 1 May 2026 implementation date should consider the following:

• Applying for code membership, if eligible. As code membership is required for the exemption and to access the modified ground 4A possession ground, it is vital that steps are taken early to ensure membership well in advance of 1 May 2026. 
• Communicating the upcoming changes to tenants. Many students will not be aware of the new rules and may be surprised to learn that they no longer have a fixed-term agreement. While existing tenants will need to be given the government’s information sheet, this is likely to be of general application to the PRS. Providers should consider what additional information should be communicated to existing and prospective tenants (and their guarantors) to explain how the changes impact PBSA.
• Familiarising themselves with what documents they need to give tenants on or before 31 May 2026, including the government’s information sheet and the ground 4A written statement if they wish to be able to rely on the new ground 4A possession ground. 
• Whether to serve section 21 notices in advance of the 1 May 2026, where it is still possible to do so, and, if not, considering section 8 notices relying on the modified ground 4A ground after the 1 May.
• Reviewing processes and agreements, including preparing code-compliant common law tenancy templates, ready to grant to students after 1 May.  

Conclusion

The implementation of the act will no doubt bring substantial change to the PRS. PBSA providers should be preparing now for the short-term impact of the act, managing the transitional period, as well as the longer-term shift away from the assured tenancy regime.