What’s changing - and why it matters for deposits
From 1 May 2026, new tenancies in England will begin as assured periodic (rolling) tenancies and existing assured shorthold tenancies will automatically convert to the new format. This means tenancies will have no fixed end dates, placing even greater importance on how the property’s condition and deposit records are maintained over time. Agents can support this by following best practice guidance on inventories and record keeping.
These changes will inevitably shape how tenancies are managed, and ultimately, how they end. As tenancies become more flexible and potentially longer in duration, the conditions at check-out will come under greater scrutiny. The longer a tenancy lasts, the harder it becomes to evidence the difference between fair wear and tear and damage, so agents will need to rely on more than just check-in and check-out reports to support any proposed deposit deductions.
Tenants are more informed, and more confident to challenge
As tenant rights are strengthened, awareness of deposit rules and dispute processes is also increasing. This means tenants may be more likely to question or challenge deductions, particularly where evidence is unclear or communication has been limited. A well-informed tenant is more likely to dispute if they disagree with a deduction, especially where expectations have not been clearly set from the outset.
End-of-tenancy is no longer a ‘clean break’ moment
The traditional model of a fixed-term tenancy ending on a clear date is evolving. As a result, the “end point” of a tenancy may feel less defined, and negotiations around deposits may require more dialogue.
This places greater emphasis on:
- Clear communication throughout the tenancy
- Transparent expectations around property condition
- Evidence that reflects the full lifecycle of the tenancy
Where agents may see increased risk
In this new landscape, certain gaps in processes are likely to become more exposed.
Common risk areas include:
- Insufficient inventory detail. Generic or vague check-in reports make it difficult to evidence change over time
- Lack of mid-tenancy inspections. Without interim records, it becomes harder to demonstrate when damage occurred
- Poor documentation practices. Missing dates, unclear photos, or inconsistent reporting can weaken a claim
- Over-reliance on standard clauses. Clauses alone are not evidence, adjudication decisions are evidence-led
In deposit disputes, it is not what is written in the tenancy agreement that decides the outcome, it is what can be evidenced. Agents can strengthen their position by understanding what constitutes strong evidence in a dispute (see TDS guidance on disputes and damages).
What agents should do now
While the reforms introduce change, they also present an opportunity for agents to strengthen their processes and reduce the likelihood of disputes.
Practical steps agents can take include:
- Enhance inventory quality. Ensure check-in reports are detailed, accurate and supported by high-quality, dated photographs.
- Introduce regular property inspections. Mid-tenancy visits provide a valuable audit trail and help identify issues early.
- Maintain consistent records. Keep clear, chronological documentation of the property’s condition throughout the tenancy.
- Set expectations from the outset. Communicate clearly with tenants about cleaning, maintenance and end-of-tenancy standards.
- Take an evidence-led approach to deductions. Be prepared to justify any proposed deductions with clear, objective evidence. Strong evidence is the single most important factor in achieving a fair and successful dispute outcome.
Supporting agents through change
The Tenancy Deposit Scheme sees first-hand how disputes arise and how they are resolved. Their adjudication service is evidence-based and impartial, and they continue to support agents with guidance, resources and training to help prevent disputes before they occur. As the private rented sector evolves, so too must the processes that underpin it. Agents who take a proactive, evidence-led approach will be best placed to navigate these changes with confidence.
Looking ahead
The Renters’ Rights reforms mark a shift in how tenancies are structured and experienced. While this may introduce new challenges, it also offers an opportunity to improve standards, transparency and trust across the sector.
Agents who adapt early by strengthening processes and focusing on evidence, will not only reduce disputes, but also deliver better outcomes for landlords and tenants alike.
Not with TDS?
The Tenancy Deposit Scheme works closely with letting agents across the UK to help prevent disputes, strengthen compliance, and deliver fair, evidence-based outcomes when issues arise. From practical guidance and adjudication expertise to training through the TDS Academy, they are here to support agents at every stage of the tenancy lifecycle.
Through initiatives such as Agent+, which provides access to exclusive resources, insights and partner benefits, and their growing network of API integrations - enabling agents to register and manage deposits seamlessly within their existing CRM systems, TDS continues to support agents in improving efficiency and reducing administrative burden. Find out more about how TDS can support agency businesses.
TDS: Easy tenancy deposit protection
Tenancy Deposit Scheme (TDS) is the only not-for-profit, Government-approved tenancy deposit protection scheme offering both FREE Custodial tenancy deposit protection and Insured tenancy deposit protection.
