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First-time buyers hit with a hidden £1,800 bill under new renting rules, rising to more than £2,700 in London

ended 26. August 2026

Renters hoping to escape the rental market have been handed an expensive parting gift. Under the Renters’ Rights Act, tenants in England must give their landlord at least two months’ written notice to end a tenancy, double the single month most renters gave before. 

The change came into force on 1 May 2026, and four months on, brokers say its side-effect is starting to bite.

Mortgage advisers report that first-time buyers are now reaching completion day only to discover they must keep paying rent, council tax, energy and water on a home they have already left. 

That extra month of outgoings lands at exactly the moment they are paying legal fees, moving costs and their first mortgage payment.

The typical cost of that extra month, based on official average figures, is £1,800. In London, where the average rent alone is £2,317 a month, the bill climbs to more than £2,700.

  • Are you seeing clients pointing this out and being upset by it?
  • Is it a ticking time bomb, because first-time buyers are now reaching completion day now since the Renters' Rights Act was implemented?
  • Could this be a major and expensive issue and slow down the property market even further?

Responses by tomorrow morning.

8 responses from the Newspage community

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Toby Quanstrom
Director at Quanstrom Financial
The Government has scored an own goal against the very renters it set out to protect. A purchase takes roughly three to four months from offer to completion, so buyers who offered after the Act arrived on 1 May are only now completing and discovering the damage. Notice cannot safely be served until exchange, so new buyers are paying their first mortgage payment and setting up bills in their new home while still owing up to two months of rent, council tax and utilities on the one they have left. That overlap typically costs £1,800 per month, and we now warn every buying client who rents, so they are braced for the monstrous bills that land following completion. This, paired with April 2025's cut in the first-time buyer stamp duty threshold from £425,000 to £300,000, has made it even harder to get on the ladder.

The fix is simple: let tenants give one month's notice where exchange of contracts can be evidenced.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
The difficult part for first-time buyers is timing their notice. Giving two months’ notice before their purchase is certain risks leaving them without a home if the transaction is delayed or falls through, but waiting for that certainty can mean paying rent and a mortgage at the same time.

That overlap needs to be budgeted for alongside legal fees and moving costs. For buyers already stretching every pound to get onto the ladder, another month of rent and household bills could be a painful final hurdle.
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Tracey Dixon
Buy-to-Let Mortgage Specialist & Owner at Pure Mortgage and Protection
This could become a real headache for first-time buyers. Buying a home rarely comes with a guaranteed completion date, so giving two months’ notice on a rental property can be difficult to time.
Give notice too early and a delay in the mortgage, valuation or legal work could leave you without somewhere to live. Wait until completion is certain and you could face paying rent alongside your first mortgage payment and all the other costs of moving.
For buyers who have spent years saving a deposit, an unexpected extra £1,800 or more at the finish line is significant.
My advice would be not to give notice simply because you have a mortgage offer or an expected completion date. Protecting yourself from being left without a home has to come first, but buyers now need to budget for the possibility of an overlap.
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David Stirling
Independent Financial Adviser at Mint Wealth
This is catching first-time buyers completely off guard. They've saved for the deposit, sorted the mortgage, budgeted for legal fees and moving costs. They then discover they're on the hook for a full extra month of rent, council tax and bills on a home they've already left, because notice now has to be given two months out. It's not just an unwelcome surprise, it's a genuine affordability cliff-edge that nobody factors into their moving budget. The ones who don't see it coming are the ones who end up having to delay completion or scramble for a bridging solution they didn't plan to need.
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Michelle Lawson
Director at Lawson Financial
Whilst the 2 month notice rule is true, any agreements pre-Renters Rights that have a lesser 1mth notice means this can be over-ridden. It will cause more of an issue under the new tenancy agreement regime as time passes but Landlords can agree to sever the tenancy earlier if they wish. Apparently, according to the Government and Shelter etc, this is what tenants wanted but many haven't realised the implications of such a demand until it is put into practice. Yet another unintended consequence of this ill thought out Bill. This is a case of not only wanting your cake and eating it, but also wanting the napkin and fork provided too, then not liking the taste of the cake. Timing is crucial and provision essential and now very much needs to be factored into finances.
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Tony Sanchez
Founder at Bridging Loan Directory
The additional cost is real, but it is not an unavoidable £1,800 bill for every first-time buyer. Existing tenancy terms can affect the notice required, and a landlord may agree a shorter period in writing.

The problem is timing. Serving notice before exchange risks leaving the buyer without a home if the purchase collapses. Waiting until exchange provides certainty, but the usual gap between exchange and completion is far shorter than two months, creating an overlap between rent and mortgage costs.

That overlap should form part of completion planning from the outset. Buyers need to check their tenancy agreement, ask whether their landlord will accept an earlier surrender and retain enough cash for rent, bills, moving costs and the first mortgage payment.

It is unlikely to halt the wider market, but it could delay purchases where buyers have committed almost all their savings to the deposit and associated costs. It is only a “hidden” cost if nobody warns the buyer before exchange.
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Rohit Kohli
Director at The Mortgage Stop
I'm honestly surprised this has caught brokers out. The two months' notice rule under the Renters' Rights Act was public well before 1 May, and any adviser worth their fee should already be building it into a client's moving timeline if they're coming out of rented. This isn't a hidden bill, it's a missed conversation.

There's a real issue underneath it though: in England, the way property transactions work, and the way people think about them, is that exchange and completion should happen as close together as possible. That mindset leaves no room for a two-month tenant notice period. This could be the moment that changes. I think the industry needs exchange and completion sitting further apart, giving notice time to run properly, or better yet, a move towards how Scotland does it, where contracts become binding earlier and timing is far more certain throughout.

It's not a penalty, and it's not a reason for the market to seize up. It's a timing mismatch, and it needs a fix.
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Harry Goodliffe
Director at HTG Mortgages
The final rent payment is for a home nobody lives in. First-time buyers are getting the keys to their new place, then realising they still owe a month of rent, council tax and bills on the place they've left, right when legal fees, moving costs and the first mortgage payment all hit at the same time. Blame the Renters' Rights Act, which doubled notice periods without anyone in Government thinking about people leaving renting for good. It doesn't destroy the market on its own, but buyers are now starting to time completions around notice dates, which, as a result, slows down chains.