The Renters’ Rights Bill – previously titled the Renters’ Reform Bill under the Conservative government – has been named as a priority for Labour with a new key date now revealed.
The highly anticipated changes to the UK’s private rented sector that will come as part of the Renters’ Right Bill are moving a step closer this month, after the government confirmed it would be moving to the Report Stage in the House of Commons on 14th January.
This is the point when all members of parliament (MPs) will debate the Bill, taking any suggested amendments into account that were put forward during the committee stage in November last year. Due to the fact that Labour has set rental reform as one of its priorities, the Report Stage is expected to be fast-tracked, potentially completing within a day.
After the Report Stage, the Renters’ Rights Bill should move onto its third reading in the House of Commons. Once it has been approved by both the House of Commons and the House of Lords, it receives Royal Assent before becoming law.
Although the Bill has been met with some negativity due to the uncertainty surrounding it, its aim is to bring in new safeguards for tenants, introducing what sets out to be a fairer system, while also improving certain processes for landlords. Ultimately, a boost to the rental sector that makes it a more appealing environment for tenants should feed through as a positive to most landlords.
Rather than work purely in favour of tenants, the Renters’ Rights Bill should offer a balance between the rights of renters and of landlords. For example, a new ombudsman will be set up to help resolve disputes between tenants and landlords more quickly and fairly; while the court system for evictions is also expected to be improved for a smoother process for all involved.
Major changes on the way?
Long-term landlords in the UK buy-to-let sector will be accustomed to legislative and regulatory changes that take place through various government administrations. These include changes to taxes, as well as new laws on things like living standards.
The Renters’ Rights Bill is being viewed as a game-changer for the industry, shaking up some of the bigger issues such as evictions, tenancy agreements, and discrimination in the sector – and these are the major points being addressed by the prospective law change, among other things.
The ‘headline’ change is the removal of Section 21 evictions – also known as ‘no-fault’ evictions – which are one of the main ways landlords can currently evict tenants. This has been met with concern from many in the industry, who are worried that removing this pathway for landlords could make it harder for them to legitimately oust tenants.
However, the Renters’ Rights Bill will aim to strengthen Section 8 evictions for landlords, funding a more streamlined court process and increasing the remit of reasons that landlords can evict.
Another big change is linked to tenancy agreements. The most common type for many years in the UK has been the Assured Shorthold Tenancy (AST) agreement, where most tenants sign up for a set period of time (normally 12 months, but sometimes with a six-month break clause). This is expected to be replaced with a periodic tenancy system – but again, with protections in place on both sides including minimum notice periods.
You can read more detailed points on the Renters’ Rights Bill below, or see the government’s website.
The official points in the Renters’ Rights Bill
According to the government website, the Renters’ 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 practice and unfair rent increases without fear of eviction. We will 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 timeframes 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.
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