Renters’ (Reform) Bill Update | July 2023
Landlords might be keen to understand what the Renters’ (Reform) Bill is and how it will affect them, if and when it comes into force.
These changes will have impact on landlords, tenants and letting agents so it’s useful to have a better understanding of what has been included, and what we know so far.
WHAT IS THE RENTERS’ (REFORM) BILL?
The Renters’ (Reform) Bill is a piece of legislation which has long been discussed but was only formally introduced into the UK Parliament in May 2023. The bill aims to improve the private rented sector for both tenants and landlords in England.
The ‘once in a generation’ reforms are set to make the private rental sector safer and fairer for all.
Upon introducing the bill, Michael Gove said “Our new laws introduced to Parliament today will support the vast majority of responsible landlords who provide quality homes to their tenants.”
Developed in consultation with landlords and tenants, the bill aims to create a fairer and more secure environment, and includes several proposed reforms:
- Introducing a national landlord register and to improve standards and increase transparency
- Establishing a Private Rented Sector Ombudsman that would be able to provide impartial and binding resolutions to any disputes
- Doubling the notice period for any rental increases, and preventing tenants being locked into automatic rent increases
- Improving the security of tenure for tenants by ending “no-fault” evictions
- Strengthening Section 8 which allows landlords to end a tenancy early if there are legal grounds to do so
- Move to periodic, rolling tenancies without a specific end date and where the tenant must give at least 2 months’ notice to leave
- Strengthening the powers of local authorities to enforce standards and take action against rogue landlords
- Offer tenants the right to request a pet in the property
HOW IS THE RENTERS’ (REFORM) BILL EXPECTED TO IMPACT LANDLORDS?
Overall landlords can expect improved sector standards and increased transparency through the introduction of a national landlord register, which is set to reduce the number of rogue landlords. In addition, increased sector standards are set to minimise the risk of being “undercut by a minority of criminal landlords”
Perhaps the biggest area that landlords wish to understand more is the abolishment of section 21 “no-fault” evictions. The Bill currently proposes that in place of the section 21, section 8 grounds are to be strengthened. Section 8 allows a landlord to end a tenancy early if there are legal grounds to do so.
Section 8 is set to include the introduction of a new mandatory ground for repeated serious arrears which will make eviction mandatory in the instance that a tenant has been in at least two months arrears on 3 occasions in the previous three years, regardless of the arrears amount at any hearing.
The new section 8 is also set to include special grounds should a landlord wish to sell their property or allow their family to move in, after a tenant has been in a property for a minimum of 6 months.
DOES A LANDLORD NEED TO DO ANYTHING BECAUSE OF THE THE RENTERS’ (REFORM) BILL 2023
As of May 2023, landlords do not need to take any immediate action. However, if The Renters’ (Reform) Bill becomes law, landlords in England will need to make some changes to their practices.
Landlords will be required to log their details on a national register, and those who let and manage their properties will no longer be able to charge letting fees for things such as referencing. Landlords will also have to observe any cap on rent increases and take into consideration the changes made surrounding eviction.
Properties being let will need to meet minimum standards, though exactly what this means is yet to be confirmed.
If this bill becomes law, landlords will need to ensure that they comply with the new rules and regulations to avoid penalties and enforcement action.
WHEN MIGHT THE THE RENTERS’ (REFORM) BILL BECOME LAW IN THE UK?
It is difficult to predict exactly when The Renters’ (Reform) Bill might become law in the UK, as it is currently in the early stages of the parliamentary process.
Some predictions believe that the reform bill will become law on 1st October 2024. New legislation in the UK normally becomes law on either the 1st of April or the 1st of October each year. Therefore, if The Renters’ (Reform) Bill is passed, it is likely to become law on one of these dates.
However, it is important to note that the parliamentary process can be lengthy and complex, and the bill may be subject to amendments or delays. The government has stated that it is committed to delivering reforms to the private rented sector, but the specific details of the legislation may change as it progresses through parliament.
WHO IS IN CHARGE OF THE RENTERS REFORM BILL?
The Renters’ (Reform) Bill was introduced into the UK Parliament in May 2023 by the Secretary of State for Housing, Communities and Local Government, currently Michael Gove.
Developed in consultation with landlords and tenants, as well as other stakeholders in the private rented sector, the government has stated that the bill is part of its commitment to delivering reforms to the private rented sector and creating a fairer, more secure, and higher quality private rented sector for both tenants and landlords.
RENTING YOUR PROPERTY
Hazells have an established letting and property management department. If you’d like to discuss renting your property, please get in touch with a member of our team.