The Renters Reform Bill has finally passed its final stage in the House of Commons and been voted in by MPs. Here we look at some of the key points in the Bill.
The Renters Reform Bill was initially based on a number of reforms to the private rented sector set out in a White Paper published in June 2022, and was introduced to Parliament in May last year. Since then, the Bill has been debated extensively, with a number of amendments added to the initial proposals.
Essentially, the Bill has always promised to make the UK’s private rented sector fairer for tenants. However, critics and landlords have pushed back, arguing that some of the proposals, such as banning Section 21 “no-fault” evictions, unfairly impact landlords due to what has been accepted as a sub-par court process.
This is something that has been factored in in the final Bill, with the government assuring that Section 21 evictions will not be banned until a thorough probe – and presumably improvement – of the courts had been held.
One argument is that, while protecting tenants is important, landlords must have the right to evict tenants without a lengthy court process where they have reasonable grounds, such as rent arrears or needing to reoccupy or sell the property.
The final Renters Reform Bill, which will now pass through the House of Lords before becoming law, contains some lengthy proposals for the sector, but below is a summary of some of the main things that will change for landlords.
Renters Reform Bill: some key points
Section 21 “no fault” evictions will be banned
At present, landlords can evict tenants without giving a reason, under Section 21. Many landlords prefer this method of eviction, as opposed to using Section 8 which applies when tenants have broken the terms of a tenancy, because it is deemed quicker and more straightforward.
Banning this is aimed at making it fairer for tenants, and preventing landlords from selling unfairly, such as if a tenant has asked for repairs to be made, or the landlord wishes to increase the rent substantially, for example. While the Renters Reform Bill will still ban no fault evictions, it will only do so once the court system is improved.
Fixed term tenancies will be abolished
Most landlords use assured shorthold tenancy agreements or assured tenancy agreements, which normally involves tenants signing up for a year. The Renters Reform Bill will ultimately end these tenancy types, and instead all tenants will be on a periodic or rolling tenancy agreement, which runs monthly.
However, one amendment to this that has been passed is that there will be a default six-month minimum in all contracts, similar to the break clause that already exists. This means tenants must stay for a minimum of six months before they can end their tenancy, giving landlords and tenants more security.
New mandatory grounds for possession
The Bill brings in three new grounds where a landlord will still be able to regain possession of their property once Section 21 is removed. These are: if they want to move back into the property themselves, or a family member wants to move in, or they wish to sell the property.
Where these conditions are present, the notice period will be two months, but this will not be allowed to happen within the first six months of the tenancy.
The landlord will also be able to apply to evict a tenant if they have been in at lease two months’ rent arrears three times within the previous three years, but the notice period on this ground will be increased from two weeks to four weeks’ notice.
Anti-social behaviour is a pre-existing ground for eviction, and the Bill will expand on this to include “behaviours capable of causing” nuisance or annoyance. Eviction proceedings can be started immediately if the landlord can demonstrate that this is the case.
Changes to rent increases
The Bill will bring in more regulation on when and how a landlord can raise their rents. It will be something that can only be done once a year, and the increase must only be to market prices – or what the landlord would expect to charge if they were letting to a new tenant on the open market.
The notice period for a rent increase will also increase from one month to two months, and tenants will have the right to challenge above-market rent increases.
Outlawing discrimination
Renting with pets has long since been an emotive issue in the private rented sector, with complaints that blanket bans on pets are unfair on tenants and prevent them from feeling like the property is their “home”. The Bill will change the rules so that landlords cannot “unreasonably” say no if a tenant requests to have a pet.
If having a pet is denied, tenants will be able to challenge this decision. However, landlords will be able to require insurance to cover any damage caused by pets living in a private rental property.
Landlords and agents will also no longer be able to have blanket bans on renting to families with children, or tenants on benefits, to outlaw unnecessary discrimination.
For a full breakdown of everything included in the Renters Reform Bill, see the government’s website.
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