NRLA Advocates Tenant Rights to Challenge Above-Market Rents in Wales: What Landlords Need to Know

NRLA’s Proposal: Tenant Challenge to Above-Market Rent Increases

The National Residential Landlords Association (NRLA) has outlined a significant proposal ahead of the May 2026 Welsh Government elections: tenants in Wales could gain the right to challenge rent increases deemed "above market" through the Residential Property Tribunal. This mechanism would be supported by rent valuation advice from the Valuation Office Agency (VOA).

For landlords, this signals a potential new layer of regulation impacting how rents can be increased. The tribunal route offers tenants a formal process to dispute rent hikes, which could affect rent-setting strategies and cash flow planning.

Why This Matters to Welsh Landlords

Currently, rent increases in the private rented sector (PRS) in Wales are largely governed by contractual terms and market conditions, with limited formal recourse for tenants unless breaches occur. Introducing a tribunal challenge means:

• Greater scrutiny of rent levels: Landlords must ensure rent increases are justifiable against market comparables.
• Potential delays: Tribunal processes could delay rent increases taking effect.
• Documentation and evidence: Maintaining clear records of market rents and property conditions will become essential.

These changes could particularly affect landlords with properties in areas experiencing rapid rent growth or those relying on above-average rents due to unique property features.

Energy Efficiency Incentives Linked to Land Transaction Tax

The NRLA also advocates linking energy efficiency improvements to Land Transaction Tax (LTT) rebates. This means landlords who upgrade properties to meet certain energy performance standards could benefit from reduced LTT on purchases.

This proposal aligns with ongoing Welsh Government goals to improve the PRS’s energy efficiency and reduce carbon emissions. For landlords, it presents:

• A financial incentive to invest in upgrades: Potentially lowering acquisition costs.
• Increased pressure to improve EPC ratings: Ahead of forthcoming regulations that may mandate minimum standards.

While details remain to be finalised, landlords should start evaluating their portfolios’ energy performance and prioritising cost-effective improvements.

Anticipated Stronger Enforcement by Rent Smart Wales

The NRLA calls for enhanced enforcement of rental regulations through Rent Smart Wales. With this, landlords can expect:

• More frequent compliance checks: Including licensing and property standards.
• Higher penalties for non-compliance: Increasing the costs of breaches.

Landlords must ensure all registrations, licensing, and property maintenance meet current standards to avoid enforcement action.

The Welsh Housing Survey and Future Policy

The NRLA’s manifesto includes establishing a dedicated Welsh Housing Survey to gather comprehensive data on housing conditions and trends. This data could inform future policy and regulatory decisions impacting landlords.

Practical Steps for Landlords Now

• Review rent-setting procedures: Benchmark your rents against local market data and maintain evidence to justify increases.
• Prepare for tribunal challenges: Develop workflows to respond promptly to tenant disputes, including gathering VOA advice if available.
• Audit energy performance: Identify properties that can benefit from upgrades to qualify for potential LTT rebates and meet expected standards.
• Ensure Rent Smart Wales compliance: Verify that all licensing and registration requirements are current and complete.
• Engage with agents and legal advisors: Stay aligned on changing regulations and enforcement trends.

Considering Different Landlord Profiles

• Single-unit landlords: Focus on ensuring rent increases are market-aligned and understand tribunal implications.
• HMO landlords: Given multiple tenants, anticipate more complex communication and potential disputes.
• Portfolio landlords: Prioritise compliance audits and energy upgrades across properties to maximise incentives and reduce enforcement risks.
• Accidental landlords: Seek professional advice to navigate new compliance and rent challenge processes effectively.

Next Conversations to Schedule

• Discuss with letting agents how tribunal challenges will be handled.
• Meet with energy assessors or contractors to plan efficiency improvements.
• Consult with legal or compliance experts on Rent Smart Wales enforcement readiness.

How Rentals & Sales Can Support You

Our team offers tailored portfolio reviews, compliance audits, and pricing strategy consultations to help landlords navigate these forthcoming changes. We provide actionable insights to optimise rents within market norms, identify cost-effective energy upgrades, and ensure full regulatory compliance.

Disclaimer: This article provides general information and does not constitute legal advice. Landlords should consult relevant professionals for advice specific to their circumstances.