Author : Mary-Anne Bowring
The long-awaited Renters Reform Bill may finally be introduced in the UK parliament this month. The bill was first discussed in 2019, and a fast introduction and implementation were promised, but that didn’t happen. Housing Secretary Michael Gove says the bill will be introduced into Parliament next week. No details of the contents of the bill are available. Still, it is widely anticipated that the Bill will have a new name to reflect the objectives of the White Paper on rental reform released by the government a few months earlier.
The Renters Reform Bill outlines the government's plans to usher in major reforms in the private rented sector (PRS) and improve housing quality. The proposed reform is expected to be "the biggest shake-up of the private rented sector in 30 years. In June 2022, the government published a white paper, A Fairer Private Rented Sector, explaining the full extent of its plans. That document had a few commitments to reform the private rental sector.
Here is an overview of the biggest changes outlined in the White Paper.
1. Section 21 no-fault evictions to be abolished
Section 21 is to be abolished, which means landlords can evict a tenant by the circumstances defined in law. It will level the playing field between landlord and tenant and empower tenants to challenge poor practices and unjustified rent increases. It will also incentivize landlords to engage with the tenants and resolve issues.
2. Periodic tenancies to become standard
Tenants with an Assured Tenancy or Shorthold Tenancy will be moved onto a single system of periodic tenancies. The single tenancy system will mean both parties better understand their rights and responsibilities. The aim is also to provide greater security for tenants and ensure that the flexibility that privately rented accommodation offers is retained. Tenants must provide a notice of two months while leaving a tenancy to allow the landlord to find a tenant and avoid empty tenancy periods.
3. Notice periods for rent increases to be doubled
The bill aims to limit rent increases to once a year. Landlords must provide a minimum notice of two months for any change in rent. This move is designed to combat the cost-of-living crisis. There are plans to end the use of rent review clauses. It will prevent tenants from being locked into automatic and ambiguous rent increases that may not reflect changes in the market price.
4. Introduction of Minimum Housing Standards
The government plans to introduce Minimum Housing Standards for the private rented sector (PRS) by extending the application of the Decent Homes Standard, which currently applies only to the social housing sector. The government also proposes to expand Rent Repayment Orders to cover repayment for non-decent homes. By making it legally mandatory for private landlords to meet the Decent Homes Standard, the government hopes that landlords will manage their properties proactively and not wait for a renter to complain or for a local council to take enforcement action.
5. Tenants given more rights to keep pets on properties
The government will ensure through legislation that landlords do not withhold consent to pet ownership. The tenant can challenge such a decision. The government will also amend the Tenant Fees Act 2019 to include pet insurance as a permitted payment so that any damage to their property by pets is covered.
6. Bans on renting to families with children
The bill will make it illegal for landlords or letting agents to have blanket bans on renting to families with children or those receiving benefits.
7. A new ombudsman covering all private landlords
A single government-approved ombudsman will be appointed to deal with all issues of private landlords renting out property in England. Membership will be mandatory.
8. New Property Portal for private landlords and tenants
A new digital Property Portal will provide a single platform to help landlords understand and comply with their legal requirements.
Mary-Anne Bowring FIRPM FRICS FARLA FCABE Founder/Head of Asset Management
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