The Renters Reform Bill has arrived in Parliament – What does this mean for Landlords in England?
20 June 2023
Introducing the Renters Reform Bill
After four long-awaited years, the Renters’ Reform Bill has finally made it to Parliament, promising the biggest shake-up for private rentals in a generation.
The Bill is expected to become law in Spring 2024 and will affect approximately 4.4 million privately rented homes in England and around 2 million landlords.
Some of the key proposed changes (among others) include:
- Abolishing Assured Shorthold Tenancies and Section 21 No-Fault Eviction Notices;
- Introducing new and amended grounds to regain possession of a property;
- Making all Assured Tenancies periodic and limiting rent periods to one month; and,
- Creating a legal right to keep pets for renters.
Abolishing Assured Shorthold Tenancies and Section 21 No-Fault Eviction Notices
Under current law, the Housing Act (HA) 1988 identifies two types of tenancies:
- Assured Tenancies (ATs); and
- Assured Shorthold Tenancies (ASTs).
What is the difference?
ASTs give landlords an automatic right to regain possession of a property through a Section 21 ‘no fault’ eviction notice where they don’t have to explain the reason for the eviction.
ATs on the other hand, do not grant landlords this right, meaning tenants have greater security against evictions.
By abolishing ASTs, many tenancies in England will become “assured”, preventing landlords from regaining possession through Section 21 notices and giving tenants more protection from eviction.
New and amended grounds for possession
In place of Section 21, landlords will still be able to utilise a Section 8 Notice which allows them to regain possession of their property when they have a legal reason to do so.
As part of the Bill, the Government intends to introduce new legal grounds for regaining possession, including if a landlord intends to sell their property.
Additionally, they intend to amend Ground 1 in Schedule 2 of the HA 1988 (among others) to extend the right of landlords (or members of their families) to require possession of a property for the purpose of occupying it as their main residence.
Making all Assured Tenancies periodic and limiting rent periods to one month
Moreover, the Bill proposes that all AT’s will be periodic, meaning they will not have a fixed-term and will continue indefinitely until the tenant decides to end the tenancy or a landlord provides a reason for possession.
The Bill also aims to limit rent periods to a maximum of a month, meaning landlords will only be able to charge rent weekly, fortnightly, four-weekly, or monthly.
This has been met with opposition by many student letting companies who tend to offer fixed-term tenancies and charge rent on a quarterly basis. Similar resistance caused the Welsh Government to change its mind about the recent Housing Reforms in Wales, which originally intended to abolish fixed terms.
Whether these proposals will be amended before they are implemented remains to be seen.
A legal right to keep pets for renters
In addition, the Bill provides tenants with the right to ask a landlord’s permission to keep a pet in their rented property and ensures that landlords do not unreasonably withhold consent, with a tenant having the right to challenge a landlord’s decision.
The Government also proposes amending the Tenant Fees Act 2019 to make pet insurance a permitted payment, meaning landlords will be able to require pet insurance to cover any damage to their properties.
These provisions aim to provide more rights to tenants with pets while protecting the interests of landlords in case of pet-related damage to their properties.
Additional proposals from the Bill
Other proposals include:
- A new Property Portal to allow landlords to demonstrate regulatory compliance and give renters all the information before entering into a tenancy agreement;
- A Private Renters Ombudsman to settle Landlord/Tenant disputes out of court;
- A Decent Homes Standard (similar to the social rented sector) for the private sector to reduce the number of homes in poor condition;
- An end to rent review clauses, while retaining the right to increase rent annually; and,
- Making it illegal for landlords to impose blanket bans on renting to families with children or those receiving welfare benefits.
How can we help you?
If passed, the Renter’s Reform Bill will bring about various changes to the private rental sector which will impact both landlords and letting agents.
With offices in England and Wales, the Property Litigation team at Redkite can offer legal advice on all Landlord and Tenant matters under both English and Welsh Law.
If you would like help or guidance, or if you have any other queries, please contact our team of experts at Redkite Solicitors. We are here to help and support you every step of the way.
This article was written by Redkite Solicitors’ Trainee Solicitor, George Tagoe. To find out more about George and the support that he can provide to you, visit his website profile here.
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.