Letting agents could face fines of up to £7,000 per breach under the Renters’ Rights Act with exposure rising to £40,000 for repeat offences as new compliance requirements come into force from 1 May.
Industry warnings suggest that seemingly minor process gaps could scale quickly across portfolios, particularly where requirements apply on a per-tenancy basis.
Alto has launched a free Renters’ Rights Risk Calculator to help agents assess their exposure, as concerns grow that many firms may be underestimating the operational impact of the reforms.
The tool prompts agents to review key areas including tenancy structures, rent controls, audit trails and compliance processes, before identifying potential gaps and estimating associated financial risk.
REAL FINANCIAL RISK
Nick Shaw (main picture, inset), Chief Revenue Officer at Alto, says: “We’re already seeing agents underestimate how exposed they are. It’s not one big failure, it’s small gaps in how the business runs day to day. A process that isn’t quite right. A safeguard that’s missing. A system that doesn’t fully support the new rules.
“On their own, those don’t always get picked up. But under the Renters’ Rights Act, they carry real financial risk – and that risk multiplies across every tenancy you manage.”
The first phase of the reforms marks a major operational shift for the sector, including the move to periodic tenancies, the abolition of Section 21 evictions, tighter rent controls and increased expectations around compliance and record keeping.
AUTOMATED CONTROLS
Alto says its wider product updates aim to embed compliance directly into lettings workflows, including automated rent review controls, safeguards against rental bidding, and full audit trails across tenancies.
Owen Rogers, Product Director at Alto, says: “The challenge isn’t understanding the rules – it’s applying them consistently across hundreds of tenancies. If your system doesn’t support that, your team ends up carrying the risk. And that’s where mistakes happen.”
The calculator is designed to help agents prioritise immediate risks ahead of implementation, while also identifying further exposure as additional measures are introduced later in 2026.
Shaw adds: “The agents who get ahead of this now will be in a much stronger position – not just from a compliance point of view, but commercially as well.”
