The recently introduced Renters’ Rights Bill promises significant changes to the UK’s private rental sector (PRS), affecting approximately 2.3 million landlords and 11 million renters in England. Below is a detailed look at the proposed legislation.

Key Measures and Timeline

The bill, introduced by the Labour government, builds upon the previous Renters (Reform) Bill with 80 additional clauses. Housing Minister Matthew Pennycook anticipates it will become law by spring next year. Key measures include:

1. Tenancy Structure and Evictions
• Abolition of Section 21 ‘no-fault’ evictions for all tenancies
• Elimination of fixed-term tenancies, replaced by rolling tenancies from the outset
• Introduction of a 12-month protected tenancy period for tenants
• New and amended possession grounds for landlords:

A. Property Sale: Landlords can reclaim possession to sell the property, with restrictions:

i. Cannot be used within the first 12 months of a tenancy
ii. Requires four months’ notice to the tenant
iii. The property cannot be marketed for 12 months after the notice expires or a court claim is filed

B. Landlord/Family Occupation: Modified existing ground for landlord or family to move in:

i. Cannot be used within the first 12 months of a tenancy
ii. Requires four months’ notice
iii. Same 12-month restriction on remarketing as the sale ground

C. Student Housing: New ground for HMOs let entirely to students:

i. Allows landlords to regain possession for the purpose of continuing to let to students
ii. Landlords must provide prior notice of this before tenants move in

• Amendment to mandatory rent arrears ground: Now requires three months’ arrears and four weeks’ notice

2. Rent Setting and Increases

• Ban on rental bidding wars and offers above the listed rate
• Strict controls on rent reviews, limiting increases to once annually

• Cap on increases to the lower of market rates or landlord’s proposal
• Two months’ notice required for rent increases
• Tenant right to challenge increases via First-tier Tribunal

3. Property Standards and Tenant Rights

• Application of the Decent Homes Standard to private rentals, with fines up to £7,000 for non-compliance
• Extension of ‘Awaab’s Law’ to the PRS:
– Named after two-year-old Awaab Ishak, it sets clear timeframes within which landlords must make homes safe when they contain serious hazards
– Will apply to both social housing and private rentals
• Ban on discrimination against tenants on benefits or with children
• Strengthened rights for tenants to keep pets in rented properties:
– Landlords will need a good reason to refuse
– Landlords can ask tenants to take out pet insurance to cover potential damage

4. Landlord Regulations and Enforcement

• Mandatory Ombudsman service for all landlords
• Creation of a mandatory digital private rental sector database of landlords
• Enhanced local authority enforcement powers:
– Greater powers to investigate and enter PRS properties
– Substantially increased financial penalties for non-compliance
• Expansion of Rent Repayment Orders

5. Dispute Resolution

• New Ombudsman service to provide fair, impartial, and binding resolution for disputes
• Aims to reduce the need for court proceedings
• Support for landlord-initiated disputes is under consideration but not currently included in the Ombudsman’s remit

The Renters’ Rights Bill represents a substantial overhaul of the private rental sector in the UK. While aimed at creating a fairer market for tenants, it also presents new challenges and considerations for landlords.

As the bill progresses through Parliament, further details and potential amendments may emerge. Estate agents and property professionals will play a crucial role in helping both landlords and tenants understand and adapt to these significant changes in the rental market.

The full text of the bill can be found here

bills.parliament.uk