The Renters’ Rights Bill is now at Committee stage, having been through the 1st and 2nd Readings in the House of Commons. Statements from the Government have made it clear that the intention is to ensure this Bill is passes as quickly as possible so that the people who rent their home have stronger rights. The Renters’ Rights Bill will (further) amend the Housing Act 1988 (as amended) and enable further legislation to be passed.
While there may be changes to the Bill as currently drafted, the current key provisions relate to:
At the start of Tenancies
- There will be greater transparency in relation to rent amounts in the advertising of properties for rent. ‘Bidding wars’ between potential tenants will no longer be allowed. The advertised rent for a property will be the highest rent that can be agreed (at least for an initial period)
- Landlords will not be allowed to discriminate against tenants who are in receipt of welfare benefits or have children, but landlords will be allowed to consider a prospective tenants income into account when determining whether that person will be able to afford then rent.
- Tenants will have better access to information by way of a new Landlord Private Rented Sector (or ‘PRS’) database that will be set up. Landlords will have to register with the new database before they can, among other things, market a property to let under a residential tenancy. Landlords will be required to have met the expected statutory standards (e.g. in relation to EPCs and Gas Safety Certificates) before they can register, and many of the grounds for possession will not be available to landlords who are not registered. The current bars to using s21 are effectively being moved to apply to s8.
- All tenancies will be periodic from the start, and Landlords will be restricted from using certain grounds for possession (essentially those that are not the fault of the tenant) in the first 12 months
During a tenancy
- Tenants will have increased rights to challenge rent increases. Contractual rent increases will no longer be effective, and all rent increases must be made via the statutory process. In a change to s13 of the HA1988, landlords will have to give tenants at least 2 months’ notice of any proposal to increase rent. Tenants will have the right to ask the relevant tribunal to determine ‘open market rent’ from the start of the tenancy or on receipt of a notice proposing a rent increase.
- Landlords will be obliged to consider requests from Tenants regarding pets. Tenants will have the right to have their request to keep a pet considered and not unreasonably refused. Landlords will need to respond to any requests within 28 days (although the initial response can be a request for further information). Landlords will be allowed to ask tenants to prove they have adequate insurance in place, or to recover the cost of the landlord obtaining such insurance. The Tenant Fees Act 2029 will be amended to permit payments in relation to insurance for damage caused by pets.
- Rent Repayment Orders (RROs) will become available for a broader range of offences or breaches by landlords, included misusing possession grounds, breaching restrictions on marketing and letting properties or failures to register on the PRS database or with a redress/Ombudsman scheme. The time period for tenants (or local authorities) to apply for a RRO will be increased from 12 to 24 months and the maximum penalty will increase to 2 years’ rent.
- A Decent Homes Standard will be introduced to improve the standard of private rented properties. New standards and specific timeframes for removing serious hazards in private rented properties will be introduced, and local authorities will have additional enforcement powers.
At the end of a tenancy (and dealing with disputes)
- The Bill allows for further regulations to be made which require landlords to be a member of a new Private Rented Sector Legal Ombudsman Service. The purpose of such a scheme is to allow prospective, current and former tenants to have their complaints investigated and determined by an independent person. We look forward to learning more about this as and when the Secretary of State introduces further legislation, but it is likely that failing to join such a scheme will potentially be a costly error. A decision made by a redress scheme may be enforceable as if it were a court order, so landlords will need to be aware and engaged in the process.
- The abolition of ‘s21no fault’ evictions is the headline announcement. Tenants will have the threat of arbitrary evictions removed and will enjoy more security. The current requirements (for example in relation to EPCs, Gas Safety Certificates and deposit protection) are likely to become pre-requisites for registration as a landlord in the new PRS.
- There will be amendments to some of the current ‘fault’ grounds. The key change for many private landlords will be the amendment to Ground 8 of Schedule 2 to the Housing Act 1988, which will require there to be thirteen weeks/three months’ rent arrears (instead of the current 8 weeks/2 months) before a notice can be served. Any rent unpaid because of delays to payment of welfare benefits for housing costs will be ignored for the purposes of calculating the amount of unpaid rent.
The Bill recognises that Landlords may, in certain circumstances, need to evict tenants who are perfectly good tenants, and the ‘fault’ grounds that notices can be based on will be expanded to include situations where a landlord intends to sell the property.
- We will wait to see what, if any, amendments are made to the Civil Procedure Rules to try to reduce the burden of this change on an already stretched court service.
