After several weeks of debate and speculation across the rental industry, the government has published the latest version of its Renter’s Rights Bill. The bill delivers on Labour’s manifesto pledge to reform the existing rental experience for both tenants and for landlords.
With 11 million private renters and 2.3 million landlords in England, the Renter’s Rights Bill represents a significant change to the private rental market, as well as to society at large.
In this article, we’ll look at the background of the bill, the government’s aims and motivations, what the Renter’s Rights Bill will do, and how its reforms will be implemented.
September’s updated bill introduced amendments to rent repayment orders and there will likely be slight amendments to the bill as it progresses through Parliament. However, landlords should become familiar with the current proposals as they come ever closer to becoming law.
What is the Renter’s Rights Bill and Why is it Important?
According to guidelines published by the new Labour government, reform of the rental sector is long overdue with millions of people living with the knowledge that they and their families could be uprooted with very little notice.
Enhancements to renters’ rights have been hotly contested for several years, leading to uncertainty for both renters and landlords about the future. The outgoing Conservative government shelved its own Renters Reform Bill in the run-up to the 2024 General Election, putting an end to its 2019 manifesto pledge to ban no-fault evictions.
Since coming to power, the Labour government has moved swiftly to introduce its Renter’s Rights Bill.
What Does the Renter’s Reform Bill Aim to Achieve?
The Renter’s Reform Bill sets out to deliver on Labour’s commitment to transform the experience of private renting with several key reforms, including the ending of Section 21 ‘no fault’ evictions.
The government states that ‘a functioning private rented sector can provide a secure stepping stone for aspiring homeowners and flexibility for those who want it.’ However, its guidance also observes that the insecurity embedded within the current system fails both tenants and landlords who are undercut by a minority of ‘rogues and chancers’.
Addressing the insecurity within the rental system the Renter’s Reform Bill is central to the government’s ‘Opportunity Mission’, which seeks to give everyone the chance to achieve their potential.
Why Does the Renter’s Reform Bill Matter?
The Rental Reform Bill will introduce significant changes to the current rental system. Although it could be argued that most of the bill’s legislative changes primarily impact landlords, both tenants and landlords need to be aware of their full rights and responsibilities.
The bill introduces new charges and penalties that can apply where rules are breached, so landlords and renters should understand what is expected of them to allow rentals to run smoothly and avoid any potential financial penalties.
Although these changes may appear to target landlords, it should be noted that the Renter’s Rights Bill is designed to offer protections for both renters and landlords. Property owners will still be able to take possession of their properties by compiling with grounds outlined within the bill.
Mark Wilkinson, Lettings & Property Management Associate at Meller Braggins, discusses the new bill affecting the lettings and property management sector. While he acknowledges that the changes may initially raise concerns, he believes they will not negatively impact most landlords. The bill aims to enhance industry transparency and eliminate a small number of unscrupulous landlords.
Addressing landlords’ worries about the abolition of Section 21, Mark reassures them that the process for regaining possession will shift but remain largely similar, typically involving Section 8 notices for valid reasons. He advocates for rent protection guarantee policies to provide additional security and help manage costs.
Mark concludes that for responsible landlords who view property investment as a long-term venture, it will be "business as usual." If anyone has any questions, please don’t hesitate to contact Mark or anyone in the office if you have any questions about the bill and the upcoming changes.
Overview of the Renter’s Rights Bill Measures
According to the government’s most recent guidance, the Renter’s Rights Bill will:
- Abolish section 21 evictions and move to a simpler tenancy structure where all assured tenancies are periodic – providing more security for tenants and empowering them to challenge poor practices and unfair rent increases without fear of eviction. The current intention is to implement this new system in one stage, giving all tenants security immediately.
- Ensure possession grounds are fair to both parties, giving tenants more security while ensuring landlords can recover their property when reasonable. The bill introduces new safeguards for tenants, giving them more time to find a home if landlords evict to move in or sell, and ensuring unscrupulous landlords cannot misuse grounds.
- Provide stronger protections against backdoor eviction by ensuring tenants are able to appeal excessive above-market rents which are purely designed to force them out. As now, landlords will still be able to increase rents to market price for their properties and an independent tribunal will make a judgement on this, if needed.
- Introduce a new Private Rented Sector Landlord Ombudsman that will provide quick, fair, impartial and binding resolution for tenants’ complaints about their landlord. This will bring tenant-landlord complaint resolution on par with established redress practices for tenants in social housing and consumers of property agent services
- Create a Private Rented Sector Database to help landlords understand their legal obligations and demonstrate compliance (giving good landlords confidence in their position), alongside providing better information to tenants to make informed decisions when entering into a tenancy agreement. It will also support local councils – helping them target enforcement activity where it is needed most. Landlords will need to be registered on the database in order to use certain possession grounds.
- Give tenants strengthened rights to request a pet in the property, which the landlord must consider and cannot unreasonably refuse. To support this, landlords will be able to require pet insurance to cover any damage to their property.
- Apply the Decent Homes Standard to the private rented sector to give renters safer, better-value homes and remove the blight of poor-quality homes in local communities.
- Apply ‘Awaab’s Law’ to the sector, setting clear legal expectations about the time frames within which landlords in the private rented sector must take action to make homes safe where they contain serious hazards.
- Make it illegal for landlords and agents to discriminate against prospective tenants in receipt of benefits or with children – helping to ensure everyone is treated fairly when looking for a place to live.
- End the practice of rental bidding by prohibiting landlords and agents from asking for or accepting offers above the advertised rent. Landlords and agents will be required to publish an asking rent for their property and it will be illegal to accept offers made above this rate.
- Strengthen local authority enforcement by expanding civil penalties, introducing a package of investigatory powers and bringing in a new requirement for local authorities to report on enforcement activity.
- Strengthen rent repayment orders by extending them to superior landlords, doubling the maximum penalty and ensuring repeat offenders have to repay the maximum amount.
It is not known exactly when the bill will become law, but at its current pace, it is expected that the Renter’s Rights Bill will become begin implementation by the summer of 2025. This will give landlords time to become familiar with the planned changes to rental regulations and prepare accordingly.
The full updated Guide to the Renter’s Rights Bill can be found here.
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