Blog, Featured

Renters Reform Bill – key points and next steps

14 May 2024

Nick Joelson

Back

After passing through Parliament, the much-talked-about Renters Reform Bill now faces scrutiny in the House of Lords. While it has seen a whole host of amendments since it was first drawn up—which may help take the sting out of some of the measures—it still has the potential to change the rental market in the UK and, ultimately, how landlords operate. 

Although knowledge of the bill is increasing, its lengthy journey through Parliament means that many landlords must be made aware of it and its potential ramifications. Plus, the squabbling over amendments can make it hard to keep up with the bill’s contents. 

So, what is the Renters Reform Bill, and what does it mean for landlords and their rental properties? To support our brokers and their landlord clients, we break down the bill and look at the key parts to consider.

What is the Renters Reform Bill?

Dubbed by the National Residential Landlords Association (NRLA) as ‘a seismic shake-up of the private rental sector’, the bill forms a vital part of the Government’s commitment to “bring in a better deal for renters”.

The aim is to drive up standards in the rental market and ‘level the playing field’ between landlord and tenant through several key measures.

This includes:

  • The abolishment of Section 21 ‘no fault evictions’ as part of a move to a ‘simpler tenancy structure’ where all assured tenancies are periodic. 
  • While this has raised concerns among landlords, the bill aims to introduce more comprehensive possession grounds, meaning that landlords can still recover properties where tenants are at fault, in repeat arrears, or if they wish to sell the property or move in close family. 
  • Appoint a new Private Rented Sector Landlord Ombudsman that landlords must join to ‘provide fair, impartial, and binding resolution to many issues and prove quicker, cheaper, and less adversarial than the court system’.
  • The creation of a Private Rented Property Portal to support landlords in understanding their legal objectives and demonstrating compliance. Landlords will be legally required to register their property and pay a registration fee, which has not yet been set by the Government. 
  • Giving tenants the right to request a pet.

What amendments have been proposed (so far)? 

While all amendments are subject to change as it passes through the House of Lords, we have seen several proposed alterations to the bill.

The Government remains committed to abolishing Section 21, ‘no fault evictions’—much to the concern of many landlords. However, it looks set to delay this to allow the Lord Chancellor to properly assess the county court possession order process in England and its enforcement. Could this process and any subsequent court reforms provide a reprieve for landlords?

In addition, with the removal of fixed-term tenancies, tenants will no longer be able to serve notice from day one. Instead, a proposed change will require tenants to give two months’ notice to leave. When you consider they can only do this after four months, landlords will have guaranteed occupancy for at least six months. 

For landlords with student lets, a new amendment will align tenancies with the academic year to ensure landlords can guarantee properties to prospective students for the start of the new academic year. 

Whether all these amendments and more will survive multiple stages with the House of Lords remains to be seen. Nevertheless, the bill will likely return to Parliament in one form or another and eventually receive royal assent. 

What about the General Election?

With an election looming and bills not being carried from one Parliament to the next, many landlords may hope the lengthy parliamentary process will kibosh the bill before it sees the light of day. That’s especially true given the uphill battle that the incumbent Government is set to face whenever the election is called.

However, Labour has been clear that it supports the notion of rental reforms, which could form part of any ‘wash-up’ before Parliament is dissolved. Besides, Labour has said previously that if it comes to power, it will plan to put its version of the Renters Reform Bill to a vote within its first 100 days in office.

Clearly rental reform is on the horizon and landlords must invest the time in understanding the bill, what is requires of landlords and what it means for their properties and portfolios. Only time will tell what impact the bill will have and whether it will recognise the role the PRS in the UK housing mix or alienate landlords further. 

Visit our full product range here.