The Renters Reform Bill: here’s what Landlords need to know 

It’s no secret that the Renters’ (Reform) Bill will have massive implications for landlords across England. Whatever your perspective, one thing is clear: you’ll need to understand this legislation before it becomes law and applies to you and your rental properties.

Since you’re probably reluctant to browse the 89-page legal document, we’ve summarised the key points in this short and accessible article. That way, you’ll be able to keep on top of the new bill and stay ahead of the curve. 

The Renters’ (Reform) Bill builds upon the ‘Fairer Private Rented Sector’ white paper released in June 2022, so you may be familiar with some new rules. 

Why is the Renters’ (Reform) Bill necessary? 

If you’re a landlord in Cambridgeshire and the surrounding areas, you’ll know there’s a growing demand for rental properties coupled with an ever-squeezed rental stock. This means that tenants in Peterborough and the surrounding areas struggle to find somewhere to live. The Renters (Reform) Bill aims to address concerns like this across the country so that long-term renters (in particular) have more security. 

Summary of the Renters (Reform) Bill

The bill’s main aim is to make the rental market fairer for tenants. It revokes Section 21 evictions and amends Section 8 so that tenants can only be evicted for good reason. As part of this process, all tenancies will become periodical and will only stop when the landlord or tenant takes action to do so. At the same time, it makes evictions easier for anti-social behaviour and rent arrears while making provisions for landlords who want to sell their property or live in it. Alongside this are new measures for landlord accountability, including a new property ombudsman, landlord database and the introduction of the Decent Homes Standard. 

When will the Renters’ (Reform) Bill become law? 

The Renters (Reform) Bill will likely take a full year to pass through the Parliament and become law. It does not apply to tenancies right now. The Renters’ (Reform) Bill must be debated and amended in Parliament first. As a result, the points discussed in this article may change before the bill passes as law. For that reason, it’s essential to keep checking the news.

The new laws will be introduced in two distinct stages by the government: 

1. There will be a 6-month notice given, which states that all new tenancies after that point must follow the new laws. 
   
2. After that, there will be another year for landlords to transition their existing tenancy agreements to the new system before the new laws apply. 

It’s also worth noting that some of the measures will take longer to implement practically. For example, court reforms, setting up a new ombudsman and the new landlord database. 

What are the main points of the Renters (Reform) Bill?  

There are several points which landlords need to know about as a priority. These points may well be amended in the future, but they represent the most critical aspects of the new bill. 

‘No Fault’ Evictions Will End  

Currently, landlords can evict tenants with two months’ notice if they are on a periodical tenancy agreement. They can do this without stating a reason using Section 21, leading to the moniker ‘no fault evictions’. Many long-term, private renters subsist on these periodic contracts after their fixed tenancy agreements have ended.  So, to give tenants greater security, landlords will now have to provide a lawful reason for eviction using an (amended) Section 8 eviction notice instead. 

Major Changes To Section 8 Eviction Rules 

Section 8 is currently used when landlords want to evict tenants for anti-social behaviour, rent arrears or other misdemeanours. The Renters (Reform) Bill modifies this legislation and adds new grounds for eviction. Don’t worry, the new rules allow landlords to repossess their homes if they want to sell the property, refurbish it or come to live there. However, landlords can only do so after the first six months of the tenancy, and tenants must be given two months’ notice. Landlords won’t be able to put their property back on the rental market for three months after evicting for any of these reasons. 

At the same time, there will be ample provision for evictions due to breach of contract. For example, the court will prioritise anti-social behaviour evictions, and tenants can be given a shorter two week notice in these circumstances. Equally, significant rent arrears will be penalised more heavily. If tenants are found to have been in 2 months’ arrears on three occasions in the last three years, they can be evicted, whatever their rent balance is on the court hearing date. 

It’s worth saying that landlords will now need to use the courts to initiate these evictions, and the government plans to reform the court system in line with the Renters (Reform) Bill. 

Assured Shorthold Tenancies (ASTs) Will Become Periodic Tenancies 

Renters will no longer sign fixed-term contracts. Instead, they will sign Periodic Tenancy agreements which roll on from month to month without an end date. Tenants can give 2 months’ notice to end the contract at any point. On the other hand, landlords must follow the new Section 8 rules if they want to end the tenancy.

Rent increase clauses will disappear under this new system. Instead, landlords will be able to raise the rent once a year in line with market rates. When they do so, they must give tenants two months’ notice. If the tenant considers the rent increase to be needlessly above the market rate, they can appeal to a first-tier tribunal which will review the case. 

What About Student Lets? 

Under the new rules, landlords who let their properties to students will also have to offer Periodic Tenancy agreements – they will not be able to provide fixed-term Assured Shorthold Tenancies any longer. 

Official university accommodation will be exempt from the shift to Periodic Tenancies, but not the many private landlords who rent to students. This will cause a series of problems and will likely face reforms before the bill becomes law. 

For example, Periodic Tenancies could mean that students give two months’ notice to leave their properties as soon as exams finish in May or June, leading to summer void periods. Equally, it will be hard for landlords to advertise their properties to a new set of students as many students will have already secured accommodation for the new academic year.

A Mandatory Ombudsman Scheme For Landlords 

The bill introduces a new ombudsman (redress scheme), which landlords must join. Tenants can file complaints with the ombudsman, who will be authorised to resolve disputes between them and the landlord. 

Landlords will have to pay a compulsory subscription to the scheme to fund it. However, it is a portal aimed primarily at tenants, and landlords cannot use it to complain about tenants. 

The ombudsman can make landlords take certain actions, like:  

• Make landlords take remedial action for repairs and maintenance to their property   
• Fine landlords up to £25,000     
• Provide explanations or apologies    
• Offer information     
• Reimburse rent where necessary 

A New Property Portal & Database For Landlords 

The Renters (Reform) Bill proposes a new database for landlords. It will take the form of a property portal accessible to potential tenants, landlords and local authorities. As such, it will be a tool the government uses to monitor landlords and administer any enforcement actions. 

Landlords will have to maintain this database and supply essential information to keep their profiles up to date. If landlords do not do this, they won’t be able to rent their properties until they update their information accurately. Significantly, any infractions or sanctions will be visible for all to see on the database. 

Pets Allowed!  

Under the new bill, tenants can keep pets in the property unless the landlord can provide a good reason to stop them. These ‘good reasons’ are still being defined, but some circumstances can disqualify pets from a property – such as a rent-to-rent agreement where the superior landlord prohibits pets. The ‘Dogs and Domestic Animals Bill’ suggests several other reasons not to allow pets, which may become law. For example, where risks are posed to other tenants, medical/religious exemptions, or where the animal’s welfare is in question. 

Landlords will have 42 days to respond to a tenant’s request for a pet, and may have an extra week to consider it if they need more information about the pet.  

However, tenants can be asked to pay an extra deposit or be ordered to take out pet insurance to cover the potential damages to the property. The 2019 Tenant Fees Act will be amended to make this a ‘permitted payment’. 

The End Of Blanket Bans For Families And DSS Tenants 

Currently, landlords can refuse to rent their properties to families or DSS tenants if they don’t want to. This will no longer be allowed. Landlords cannot exclude these tenants from consideration on these grounds. 

Introducing The Decent Homes Standard 

The Decent Homes Standard will soon apply to the private rental market. Currently, this only applies to the social housing sector. Landlords will have to bring their homes up to the required standards for private renters when the new bill becomes law. 

Is that a lot to take in? If so, our team can help you understand what this new legislation means for you and your properties. We can offer tailored advice to help you navigate the new rules to keep your tenancies profitable. Talk to our team today.