The Renters (Reform) Bill
There is a great deal of anticipation relating to the Renters (Reform) Bill, which seeks to overhaul the law on residential lettings and when and how landlords can evict tenants. This article sets out the main points you need to know.
What will the Renters (Reform) Bill do?
The main changes will be as follows:
- Abolishment of section 21 ‘no fault’ evictions. Currently, a landlord can evict a tenant without providing any reason by serving with a ‘no fault’ section 21 eviction, giving the tenant two months’ notice. Once the Renters (Reform) Bill is passed as law, it will no longer be possible for a landlord to evict a tenant on a ‘no fault’ basis. Instead, the landlord will have to specify circumstances that reasonably justify eviction as set out in the statute.
- Provision of a simpler tenancy structure, where all assured tenancies will be periodic. This is intended to provide more security for tenants and encourage them to challenge poor practice and unfair rent increases without the fear of eviction. To achieve this, the landlord will not be able to grant fixed-term tenancies but only periodic tenancies, which do not have a set end date.
When will the Renters (Reform) Bill come into force?
First stage: At least six months’ notice will be provided before the first implementation date, after which all new tenancies will be periodic and governed by the new rules. The date of this depends on when Royal Assent is received and when the court system is ready to implement the new rules.
Second stage: This will be at least 12 months after the first stage. All existing tenancies will transition to the new system, after which eviction using section 21 will not be permitted and landlords will have to rely on the strengthened grounds to evict tenants.
Key points of the Renters (Reform) Bill
- they will have the ability to leave poor quality properties without remaining liable for the rent for any remaining fixed-term
- it will be easier to move out as and when the tenant’s circumstances change
- tenants will be able to stay in their home until they decide to end the tenancy by giving two months’ notice, or the landlord can provide evidence of a valid ground for possession
- landlords will not be able to rely on certain grounds within the first six months of the tenancy.
- introduction of more comprehensive possession grounds so landlords can still recover their property when their circumstances change or tenants do not fulfil their obligations. This includes where they wish to sell their property or move in close family members
- it will expedite the landlord’s ability to evict tenants who disrupt neighbourhoods through anti-social behaviour and introduce a new ground for persistent rent arrears
- repossession of property will become easier when tenants are at fault.
Additional changes from the Renters (Reform) Bill
- It will provide stronger protection against backdoor evictions, ensuring tenants are able to appeal excessively above-market rents, which are purely designed to force them out of the property. Landlords will still be able to increase rent to market price, and an independent tribunal will make a judgement on this to determine the actual market rent of a property.
- It will introduce a new private rented sector ombudsman. This is intended to provide a fair, impartial and binding resolution to many issues. It is expected to be quicker, cheaper and less adversarial than the present court system.
- A Privately Rented Property Portal will be created to help landlords understand their legal obligations and demonstrate compliance. This will provide better information to tenants before entering into a tenancy agreement. It will also support local councils, helping them target enforcement activity where it is required.
- It will give tenants the right to request a pet in the property. The landlord must consider any such request and cannot unreasonably refuse. Landlords will be able to require that the tenant take out pet insurance to cover any damage to the property.
Property portal: Landlord redress scheme
It is going to become mandatory that all private landlords join the ‘Landlord Redress Scheme’, regardless of whether they use a letting agent. Landlords can be fined up to £5,000 by the local council should they not join/breach membership requirements. Thereafter, there are fines of up to £30,000, including criminal prosecution and banning orders, if repeated breaches occur. The scheme will be self-funding, meaning all members will be expected to pay a fee. This will likely be a relatively small amount per property, but the price has not been confirmed yet.
The ‘Landlord Redress Scheme’ will be headed by the Ombudsman to provide fair, impartial, and binding resolutions to many issues relating to property standards, repairs, maintenance and poor landlord practice and behaviour.
Contact our property dispute resolution solicitors today
If you are a landlord and would like advice on how the above changes will affect you, please get in touch with our specialist Property Disputes team by using our online enquiry form or by calling 0330 404 0768.
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