Renters Reform Bill

On 17th May 2023, the Renters’ Reform Bill – noted as the biggest change to the private rental sector for a generation – was introduced to Parliament.

Originally proposed in April 2019, the Bill has had a series of delays and has only just begun its lengthy progress through the House of Commons and the House of Lords. Parliamentary observers estimate that it could take 18 months before these new laws for landlords become a part of official UK legislation.

Below is summary of the main points within the proposed reform bill. Should you want to receive updates as this passes through Parliament, please fill in the form below:

What does the Renters Reform Bill mean for landlords?

  • The Bill promises to revolutionise renting in a number of different ways. Here are some of the changes that will affect landlords:
  • The abolition of the Assured Shorthold Tenancy
  • An end to ‘no-fault’ evictions (Section 21)
  • Changes to landlords’ grounds for possession (Section 8)
  • A new property portal and landlords’ register

When is the Renters Reform Bill going to become legislation?

  • At present, we cannot confirm the date the bill will become law. The bill must pass through both houses of Parliament where amendments are expected to be made. The government plans to have the bill pass into law in the lifetime of this Parliament which is currently due to run to Dec 2024. As with most pieces of legislation there will be an implementation phase once the Bill becomes law.
  • The Government has said they plan to implement the new system in two stages and will provide at least 6 months’ notice of the first implementation date after which all new tenancies will be periodic and governed by the new rules including the changes to renting with pets. The date of this will be dependent on when the Bill has received Royal Assent. To avoid a two-tier rental sector and to make sure landlords and tenants are clear on their rights, all existing tenancies will transition to a new system on the second implementation date. They will allow at least 12 months between the first and second date.

Can Landlords do anything to prepare?

As the bill is not yet a law, there is not much landlords can do at this time. We would recommend that you keep an active eye on the bills process, so that you can adapt quickly should you be required to make changes to your rental approach.

An end to Assured Shorthold Tenancies and ‘no-fault’ evictions

Under the new proposals, the nature of tenancies will change. When an Assured Shorthold tenancy agreement comes to the end of the term, they will simply roll over and become ‘periodic’ tenancies with no fixed end date.

Going forward, landlords will be unable to evict their tenants unless they give a solid reason which has been defined in law. This could, for instance, be because the landlord needs to sell the property or wants to move into it themselves.

These new rental laws put an end to the Section 21 ‘no-fault’ eviction, where a landlord can in effect force a tenant to vacate without providing a reason.

Can I still serve a Section 21 notice now to end my current tenancy?

As the proposed Bill is not yet a law you are able to proceed to serve the Section 21 notice in line with current legislation and in line with clauses in your tenancy agreement

Is it going to be harder for me to get possession back of my property?

The government plans to make changes to the grounds within Section 8, which will make it easier for landlords (or letting agents who act on their behalf) to regain possession of rental properties. The changes will apply to instances such as persistent rent arrears and antisocial behaviour. A new, mandatory Ombudsman service is also planned to help with disputes. It is hoped that the new body will streamline the current system (which involves several different organisations). It should also ease pressure on the courts.

When is it reasonable for a landlord to refuse a tenant having a pet?

Landlords will be required to fully consider all requests on a case-by-case basis. Due to the diversity of landlords, tenants, and properties in the private rented sector, the Government has said it would not be possible to legislate for every situation where a landlord would or would not be able to ‘reasonably’ refuse a pet. There are situations where it will always be reasonable for a landlord to refuse a request – including where their superior landlord prohibits pets. Where there is disagreement, a tenant can escalate their complaint to the Private Rented Sector Ombudsman or through the court which makes the final decision based on the evidence provided by both parties.

What happens if a pet damages a property?

The Government is amending the Tenant Fees Act 2019 so that landlords can require insurance to cover any damage caused by pets living in the property. In the very rare cases where the insurance and deposit do not cover the cost of the damage, a landlord could take the tenant to court to recoup additional funds

How will a landlord sign up to the Property Portal and what happens if they don’t?

All landlords will be legally required to register their property on the Property Portal and will be able to do this online. Local councils will be able to take enforcement action against private landlords that fail to join the Property Portal.  If a landlord lets or advertises a property without it first being registered on the Property Portal, they can be fined up to £5,000 by the local council. If a landlord repeatedly breaches the requirement, or if they commit a serious offence such as providing fraudulent information to the Property Portal, they may be fined up to £30,000 or could face criminal prosecution and a Banning Order.

Who will pay for the Property Portal? How much will it cost landlords?

Landlords will be required to pay to registered for the Property Portal. They cost has not yet been determined but the Government say they will work to ensure that the fee is proportionate and good value.

Do I need to worry?

There is no need worry.  The Renters Reform Bill is still at an early stage in its progress (Committee Stage – as of 14/11/23). At this stage it will be thoroughly scrutinised, and amendments may be made at that time.

As agents  we are keeping a close eye on this parliamentary journey, and will undertake to keep you updated of any new developments, should you wish to receive updates from us. We will also be there to support our landlords when the Bill finally becomes law.

While it is understandable for landlords to feel some concern about the range of changes proposed, there is no need to worry. As a Hanley Estates landlord, we’re here to support you at every stage. We have a team of professionally qualified agents who know the law inside out and will work hard to ensure you continue to get the best return on your investment.