How changes in home rental laws in England will impact Hong Kong, mainland investors

An estate agent sign outside a property in London, March 5, 2026.

Photo: EPA A proposed cap on the ground rents paid by leasehold homeowners in England and Wales is seen as favouring foreign property investors, including those from Hong Kong and mainland China, but another measure tightening rules in setting rents is dampening demand ahead of its implementation, according to analysts.

An estimated 203,000 homes in England and Wales are registered to owners with an overseas address.

Hongkongers hold 14 per cent, making them the largest group of foreign investors in the segment, according to data cited by JLL.

Mainland Chinese owners, meanwhile, accounted for about 6 per cent.

London remained the top choice among foreign investors, accounting for more than a third of foreign-owned homes, or 68,700 units, JLL added.

Hong Kong-based investors own about 19 per cent of foreign-owned homes in the British capital, while mainland Chinese account for about 12 per cent.

A fundamental change, however, is ushering in a new landscape for rental properties.

British lawmakers enacted the Renters’ Rights Act (RRA) last year, which banned landlords from evicting tenants within 12 months of the lease start, among other changes.

It also mandates that landlords give tenants two months’ notice for any rent increase and requires setting the new rent to the market rate.

Should a tenant find the increase excessive, they can challenge the landlord at a designated tribunal.

A new block of flats is seen in London, August 14, 2025.

Photo: EPA Additionally, tenants can lease a property periodically instead of being tied to a fixed contract that typically lasts 12 to 24 months.

This clause is intended to bring relief to tenants who find a property substandard after signing a lease, while those wanting to remain longer gain greater security.

The changes will take effect on May 1.

The measure will primarily be implemented in England as Wales, Scotland and Northern Ireland have their own laws governing tenancies and rents. “We are seeing a temporary softening in transaction volumes due to the uncertain impact of the RRA,” said Felix Cheung, head of international residential at JLL in Hong Kong.

Investing in a residential rental property in England could prove more complicated for casual investors, said Tom Bill, head of UK residential research at Knight Frank. “There is nervousness ahead of the Renters Rights Act this May and some landlords have decided it no longer stacks

原文链接: 南华早报