What Leicester Landlords Need to Watch Out For in 2026
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What Leicester Landlords Need to Watch Out For in 2025
Being a landlord in Leicester has never been more rewarding — or more complex. Between sweeping legislative reform, tightening energy standards, evolving local licensing requirements, and a shifting tax landscape, 2025 is shaping up to be one of the most demanding years for property investors in recent memory.
Whether you own a single buy-to-let or manage a growing portfolio across the city, the risks of falling behind are real — financial penalties, compliance failures, and tenancy disputes are all avoidable with the right preparation.
At Signature Lettings, we work with landlords across Leicester every day, and we know which issues are catching people out. This guide cuts through the noise and gives you a clear, practical overview of what to watch out for in 2025 — and what to do about it.
The Renters' Rights Bill: What's Coming and Why It Matters
The Renters' Rights Bill represents the most significant overhaul of the private rented sector in a generation. If you haven't already started preparing, now is the time.
The End of Section 21 "No-Fault" Evictions
The abolition of Section 21 is the headline change. Once enacted, landlords will no longer be able to serve a no-fault eviction notice. All possession proceedings will need to be pursued through Section 8, using defined legal grounds.
This is a fundamental shift in how landlords manage tenancies, and it has practical implications for:
Dealing with persistent rent arrears
Recovering possession for sale or personal use
Managing anti-social behaviour cases
Handling tenants at the end of a fixed term
What You Should Be Doing Now
Review your tenancy agreements to ensure they are up to date and legally robust
Familiarise yourself with the expanded Section 8 grounds, including the new mandatory and discretionary grounds being introduced
Document everything — communication logs, inspection records, and rent payment histories will be essential if you ever need to pursue possession
Seek professional guidance before serving any notices — errors in procedure can delay possession by months
Signature Lettings tip: If you're managing your property independently, now is an excellent time to consider professional management. The legal complexity of the new regime makes expert oversight more valuable than ever.
EPC Requirements: The Deadline Landlords Cannot Afford to Miss
Energy Performance Certificates have been a legal requirement for some time, but the goalposts are moving — and Leicester landlords need to pay close attention.
The Proposed Minimum EPC Rating of C
The government has signalled its intention to raise the minimum EPC rating for rental properties to band C for new tenancies. While the precise legislative timeline continues to evolve, the direction of travel is clear: properties rated D or below will face restrictions on being let.
For context, a significant proportion of Leicester's private rented stock — particularly older terraced housing in areas such as Evington, Spinney Hills, and Highfields — currently sits at band D or E.
What This Means in Practice
If your property is currently rated D or below, you should be planning improvement works now, not waiting for a deadline to be confirmed
Common upgrades that improve EPC ratings include loft insulation, cavity wall insulation, double glazing, and upgrading to an A-rated boiler
Some improvements may qualify for government grant funding — it is worth checking current schemes before spending your own capital
An up-to-date EPC (valid for 10 years) is a legal requirement for marketing any property to let — check your certificate's expiry date
The Cost of Inaction
Failing to meet minimum EPC standards won't just result in a fine — it could render your property unlettable, meaning void periods, lost income, and a scramble to carry out works under pressure. Getting ahead of this now protects both your compliance and your cash flow.
Local Licensing Schemes: Are You Covered in Leicester?
Landlord licensing is an area where local knowledge is essential — and where many landlords unknowingly fall foul of the rules.
Mandatory HMO Licensing
If you let a property to five or more people forming two or more separate households, you are legally required to hold an HMO licence from Leicester City Council. Operating an unlicensed HMO can result in:
An unlimited fine
A Rent Repayment Order — meaning tenants can reclaim up to 12 months' rent
Difficulty obtaining possession through the courts
Selective and Additional Licensing
Leicester City Council has operated selective licensing schemes in certain areas of the city. These schemes require landlords in designated zones to hold a licence regardless of property type or occupancy.
Key actions for Leicester landlords:
Check whether your property falls within a selective or additional licensing zone — boundaries can change
Ensure any existing licences are current and have not expired
Confirm that your licence conditions are being met, including gas safety, electrical testing, and fire safety provisions
If you are planning to convert a property to an HMO, seek advice before proceeding — planning permission may also be required
Not sure whether your Leicester property requires a licence? Speak to our team at Signature Lettings — we can advise you based on your specific address and circumstances.
Tax Changes: Protecting Your Profit Margins
The financial landscape for landlords has changed considerably over the past several years, and 2025 brings further considerations that could affect your bottom line.
Mortgage Interest Relief: The Ongoing Impact of Section 24
If you haven't yet fully adjusted to the Section 24 mortgage interest relief restriction, you may still be underestimating its impact. Higher and additional rate taxpayers can no longer deduct mortgage interest from rental income — instead, they receive a 20% tax credit. For many landlords, this has significantly increased their effective tax liability.
Practical steps:
Review your rental income calculations with an accountant who specialises in property
Consider whether your ownership structure (personal vs. limited company) remains the most tax-efficient arrangement
Factor tax liability into your rental pricing strategy to protect net yield
Capital Gains Tax (CGT)
The CGT rates on residential property remain higher than those on other assets. If you are considering selling any part of your portfolio in 2025, take specialist advice on timing and structure — the difference between a well-planned and poorly-timed disposal can be substantial.
Stamp Duty Land Tax (SDLT) on Additional Properties
The 3% surcharge on additional residential properties remains in place. If you are expanding your portfolio, ensure this is factored into your acquisition costs and yield calculations from the outset.
Furnished Holiday Let Changes
For landlords who operate furnished holiday lets, significant changes to the tax treatment of FHLs came into force in April 2025, removing the previously favourable tax status. If this applies to any of your properties, a review with your accountant is essential.
Market-Specific Risks in Leicester: What the Numbers Don't Always Tell You
Beyond the legislative and tax picture, there are Leicester-specific market dynamics that savvy landlords should keep front of mind.
Void Periods and Tenant Demand
Leicester's rental market remains strong, driven by the city's two universities, a growing professional population, and ongoing regeneration. However, demand is not uniform across all areas or property types. Landlords who price above market rate or present poorly maintained properties are increasingly finding longer void periods as tenant expectations rise.
Ensure your rental pricing is benchmarked regularly against comparable properties
Invest in presentation — professional photography and well-maintained interiors make a measurable difference to letting speed
Understand the seasonal rhythms of demand in your specific area of Leicester
Tenant Referencing and Arrears Risk
With the removal of Section 21, tenant selection becomes even more critical. A thorough referencing process — including credit checks, employment verification, and previous landlord references — is your first and most important line of defence against rent arrears and tenancy disputes.
Consider also:
Rent guarantee insurance as a cost-effective safety net
Ensuring your tenancy deposit is registered with a government-approved scheme within 30 days of receipt
Carrying out regular property inspections and documenting their findings
Maintenance and Compliance Obligations
Landlords have a legal duty to ensure properties meet the Homes (Fitness for Human Habitation) Act requirements. Damp, mould, inadequate heating, and structural issues are not just moral concerns — they carry legal liability.
Carry out annual gas safety checks and retain certificates
Ensure electrical installation condition reports (EICRs) are current (required every five years for rental properties)
Install and test smoke alarms on every floor and carbon monoxide alarms in rooms with fixed combustion appliances
Respond to maintenance reports promptly and keep written records of all communications
How Signature Lettings Helps Leicester Landlords Stay Ahead
Navigating all of the above on your own is possible — but it requires considerable time, knowledge, and vigilance. One missed deadline, one overlooked licence, or one procedural error can be costly.
At Signature Lettings, we combine genuine local expertise with a comprehensive, hands-on management service designed to protect your investment at every stage.
We keep up to date with all legislative changes so you don't have to
We handle compliance, inspections, tenancy documentation, and licensing checks
We provide honest, experienced guidance — not generic advice
We are based right here in Leicester, at 40 The Parade, Oadby, and we know this market inside out
Whether you are a first-time landlord finding your feet or an experienced investor looking to streamline your portfolio management, we are here to make letting simple, secure, and stress-free.
Final Thoughts
2025 is a year that rewards preparation. The landlords who will come out ahead are those who treat compliance not as a burden, but as a foundation — because a well-managed, fully compliant property attracts better tenants, commands stronger rents, and protects long-term value.
The changes coming down the line are significant, but none of them are insurmountable with the right support in place.
Get in touch with the Signature Lettings team today:
📞 0116 482 1359
📧 lettings@signaturelettings.co.uk
🌐 www.signaturelettings.co.uk
We're open Monday to Friday, 9:00am–5:30pm, and Saturday, 10:00am–4:00pm.