Over the past year, letting agents have been closely examining the Renters’ Rights Bill as it proceeds from a manifesto pledge and gets closer to a passed law that has received Royal Assent.
As it looks increasingly likely to pass with no or very small modifications, and given how much it changes regarding the rental and buy-to-let market, the Renters’ Rights Bill and its potential ramifications need to be explained.
Here are the main points of the bill, how they will change the rental market, and what changes landlords should consider making in advance.
The End Of Section 21 Evictions
Also known as “no-fault evictions”, Section 21 evictions for assured shorthold tenancies have led to concerns from some tenants that they are unable to enter into a dialogue with landlords regarding necessary repairs or to challenge above-market rent increases without fear of eviction.
Removing this reduces the potential for a landlord-tenant relationship to become adversarial, encouraging a much more reasonable dialogue without an unequal power dynamic.
Instead, all tenancies will become periodic tenancies, where a tenant can stay where they live and will give two months’ notice if they need to or want to leave.
Enchanted Possession Safeguards
Due to the changes in how tenancies will work from now on, the rules for grounds for possession, necessary for a Section 8 eviction, will also change.
For most grounds, there is greater clarity with the process of eviction, and how a court will reach a decision in the case of discretionary grounds.
However, the big changes are for rent arrears and the changes to a landlord’s circumstances.
Tenants who fall into arrears must have reached three months’ worth of arrears before there is grounds for eviction, and even then the notice period has doubled to four weeks instead of two.
However, the discretionary grounds can also be used for repeat late payments.
Conversely, a landlord can reclaim a property if they need to, although they cannot do so in the first 12 months at the start of a tenancy and need to provide four months’ notice to ensure that the tenants can find new accommodation.
Stop Above-Market Rent Hikes
One particularly unscrupulous means of evicting tenants surreptitiously was to increase rent significantly above the market rate, which would force out long-term tenants who could not afford the hike.
Instead, the rules for rent increases have changed significantly. Landlords can increase rent once per year to the market rate and tenants have the right to challenge this at the First-tier Tribunal.
This will also end the practice of rental bidding, banning the accepting of rent offers above the published asking rate.
The Right To Pet Ownership
Tenants who are pet owners or who want to be pet owners are often limited when it comes to rental properties, but the Renters’ Rights Bill will require landlords to consider and only refuse if they have very good reasons to do so.
Application Of Awaab’s Law
Following the death of two-year-old Awaab Ishak from mould and damp exposure, Awaab’s Law was implemented in social housing, but the Renters’ Rights Bill will expand that to the private sector as well.
This will require landlords to fix dangerous damp and mould within a set amount of time, whilst emergency hazards must be fixed within 24 hours.
