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The Renters' Rights Bill: What Landlords Need to Know

25 November 2024

In recent developments, the Renters' Rights Bill, a major piece of proposed legislation, aims to significantly change the landscape of residential property renting in the UK.

Originally outlined by the Conservative government, the Bill had faced delays as ministers worked to streamline the court system. However, with the new government's plans, the Bill is expected to come into force by next Summer, introducing substantial changes that landlords need to understand.

Current Law: Section 21 Notices and ‘No-Fault’ Evictions

Under the current law, landlords can issue a Section 21 notice, commonly known as a ‘no-fault’ eviction. This allows landlords to end a tenancy without needing to provide a specific reason. Whether the tenancy is a fixed-term contract or a periodic one (which has no set end date), a Section 21 notice can be served, giving tenants a minimum of two months’ notice before they are required to vacate.

However, this approach is set to be phased out under the new Renters' Rights Bill.

Key Changes Under the Renters’ Rights Bill

The Renters’ Rights Bill proposes several important changes that will impact how landlords manage their properties and interact with tenants:

1. Abolition of Section 21 Notices: The most significant change is the removal of the Section 21 eviction process. Landlords will no longer be able to evict tenants without a valid reason. Instead, any eviction will need to be carried out through a Section 8 notice, where landlords must provide specific grounds for eviction, such as non-payment of rent or breach of tenancy terms.
2. Rent Increases: The Bill also introduces limitations on rent increases. Landlords will no longer be able to increase rent mid-tenancy and will only be allowed to increase rent once a year. Furthermore, rent increases must align with the market rate and cannot be arbitrary.
3. Transparency in Rental Pricing: Going forward, landlords and letting agents will be required to publicly display the asking rent price when advertising properties. They will also be prohibited from accepting offers above the advertised rent, ensuring transparency in rental agreements.
4. Tenant Eligibility and Pets: The Bill will limit discrimination against tenants, particularly those receiving benefits or with children. Additionally, landlords will need to consider any requests from tenants to keep pets, and they will no longer be able to unreasonably refuse these requests.
5. Property Standards and Fines: The Renters' Rights Bill will introduce new standards for rental properties, extending Awaab’s Law into the private rental sector. This law, which aims to ensure safe and decent living conditions, will allow tenants to challenge landlords over dangerous or substandard conditions. Landlords could face fines of up to £7,000 if their properties do not meet the required "decent homes standard."
6. Property Ombudsman: A new Property Ombudsman will be established to help resolve disputes between tenants and landlords without requiring legal action. This impartial service will allow for quicker and less costly resolutions, reducing the need to go through the courts.

What Should Landlords Do Now?

While the Renters’ Rights Bill is not yet law, landlords still have the option to proceed with Section 21 notices for now, but with the anticipated increase in claims ahead of the changes, it is advisable to act sooner rather than later if relying on this method of eviction.

Once the new laws come into effect, landlords will still be able to regain possession of their properties in certain situations. For example, tenants who fail to pay rent, engage in anti-social behaviour, or where the landlord wishes to move back into or sell the property, will still be grounds for eviction. However, the process will be more regulated, requiring clear justification for the eviction.

In conclusion, the Renters’ Rights Bill represents a shift towards greater protection for tenants, with substantial implications for landlords. While some of these changes will offer tenants more stability, landlords must prepare for a new way of managing tenancies. By staying informed and proactive, landlords can ensure they remain compliant with the upcoming legislation and continue to manage their rental properties successfully.

 

If you are a landlord seeking advice regarding the Renters' Rights Bill, please contact our residential property team, who will provide the highest level of professional and personal service. 

 

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