Rent to rent looked very different before 1 May 2026. The Renters’ Rights Act reversed Rakusen v Jepsen, doubled rent repayment orders to two years, and made superior landlords liable for what their operator does. A great many people still selling these deals have not updated the pitch. Here is the stock, and the position as it now actually stands.
Actual consent to sublet from the owner — and from their lender and freeholder where the mortgage or lease requires it. Not a clause someone drafted into a template.
Whether the property needs a licence, who has to hold it, and what occupancy it permits. As the operator you are the landlord for licensing, and that is not negotiable by agreement.
Since the owner is now exposed to your compliance failures, the arrangements that last are the ones where both sides can evidence they did it properly.
Our fee comes from the owner or the landlord. No sourcing fee, no packaging fee, no percentage of your margin.
HMO, serviced accommodation or single let. Regions, unit count, and whether you already hold licences elsewhere. We will be straight with you about which deals you are realistically able to run.
Owner consent, lender and freeholder position, licensing requirement, Article 4 status and planning use class — before you view, not after you have committed.
A company let agreement that reflects what is actually happening, the consents attached to it, and a clear record of who holds which obligation.
In Rakusen v Jepsen [2023] UKSC 9 the Supreme Court held that a rent repayment order could only be made against the immediate landlord — in a rent-to-rent structure, the operating company — and not against the property owner sitting above it. For three years that was the single most important case in this market, and a great deal of rent-to-rent was structured around it.
The Renters’ Rights Act reversed it. From 1 May 2026, enforcement reaches any landlord holding a superior interest in a property that requires a licence and does not have one, whether or not they are involved in day-to-day management. Civil penalties run to £40,000, and rent repayment orders now reach two years’ rent.
Directors can also face personal liability, which closes the other route people relied on: dissolving the operating company after the event no longer removes the exposure.
As the operator, nothing about your primary liability has softened. You are the landlord for licensing purposes, so the HMO licence is yours to hold, not the owner’s. What has changed is that the person above you now has a direct financial interest in whether you comply, which in practice means more scrutiny and more evidence requested. Give it willingly — the deals that last are the ones where the owner can see the licence.
As the owner, the arrangement can no longer be treated as arm’s length. Handing a property to an operator and not looking again is now a route to a two-year rent repayment order against you. Verify the licence, keep a copy, and check it has not lapsed.
A genuine company let — granted to a company, for occupation by its employees — sits outside the assured tenancy regime, which is why the structure is used. A company let used as a device to dress up ordinary residential subletting can be looked through, and the label on the agreement will not decide the question.
That distinction matters more now that fixed terms have been abolished for assured tenancies. And if you are managing property on behalf of owners rather than trading on your own account, consider whether you are acting as a letting agent, in which case redress scheme membership and client money protection are legal requirements rather than optional credibility.
The structure is lawful. Most of the deals done badly are not, and the difference comes down to three things: written consent to sublet from the owner and anyone whose permission they need, the correct licence held by the correct party, and the right planning use. Miss any of those and you are not running a lawful business, however the agreement is worded.
You. As the operator you are the landlord for licensing purposes, and that cannot be reassigned by agreement. Operating without the licence exposes you to a civil penalty of up to \u00a340,000 and a rent repayment order of up to two years\u2019 rent. Since 1 May 2026 it also exposes the owner above you, which is why owners are increasingly asking to see it.
Since 1 May 2026, yes. The Renters\u2019 Rights Act reversed Rakusen v Jepsen, so a rent repayment order can now be made against a superior landlord as well as the immediate one. There is a defence where all reasonably practicable steps were taken to ensure licensing, but a clause in the agreement will not satisfy it on its own. Expect owners to want evidence, and expect that to become normal.
Not as a device. A genuine company let to a company for occupation by its employees sits outside the assured tenancy regime. A company let used to dress up ordinary residential subletting can be looked through, and what the document is called will not be decisive. If your occupiers are individuals renting for themselves, take advice before you rely on the structure.
No. Our fee comes from the owner or the landlord. We do not charge a sourcing fee, a packaging fee or a share of your margin. If someone is charging you several thousand pounds to introduce a deal, ask what they are being paid by the other side as well.
