- with readers working within the Property industries
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From the tenant’s standpoint, however, the position can appear less fair. Where rents continue to rise regardless of market conditions, tenants may find themselves paying above market rates simply because they have remained in occupation for a number of years.
If the market fluctuates up and down, why shouldn't this be reflected on the rent?
The proposed legislative changes
The English Devolution and Community Empowerment Bill seeks to address this issue directly. Introduced into the House of Commons on 10 July 2025, the Bill proposes to ban upwards-only rent review provisions, and is expected to be implemented from 2027 to 2028.
Under the Bill, any commercial lease within the Landlord and Tenant Act 1954, which includes any ‘contracted out’ leases, will be prohibited from including provisions for an upwards only increase. Where rents are linked to the CPI or RPI or the market rent, any decrease in the index or market value will be reflected. Rent collars which impose a minimum increase will also be ineffective, although the Government has indicated that this position may be subject to further review to ensure such mechanisms are not used to circumvent the legislation.
Importantly, however, the Bill is not expected to be retrospective. As a result, any lease entered into before the law comes into effect can still contain these provisions.
The future of RPI-linked rent reviews
Further consideration must also be given to the future of RPI rent review provisions. RPI-linked rent reviews are expected to be abolished by 2030. It is anticipated that CPI will replace RPI across commercial leases, as this is considered fairer and a more transparent measure of inflation. Further guidance is not yet available.
What should landlords consider now?
While the proposed changes may be a little way off, there are several steps landlords may wish to consider sooner rather than later:
- Where lease renewals are anticipated before 2027/28, landlords may wish to consider agreeing terms early to ensure the leases are completed before the law comes into effect.
- Although upwards-only rent reviews are set to be banned, stepped increases, or fixed rent increases, will not be caught. These could, therefore, be agreed and set at the outset of any lease.
- Assess valuation implications. Some concern has been raised that the proposed ban on upwards-only rent reviews could affect investor confidence and, in turn, property values.
Looking ahead
For now, it's business as usual, but with these significant changes coming just round the corner, both landlords and tenants would be sensible to stay up to date on the proposals and the timing of implementation when this becomes clearer.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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