The Renters Reform Bill will return to the House of Commons later this month, after much squabbling around proposed amendments.
Around 50 Conservatives MPs, who included landlords, had raised concerns that the legislation would see more landlords sell up. The Government has proposed amendments, although some charities and groups have claimed that the Bill has been watered down to appease Conservative backbenchers.
With all the wrangling, coupled with the Bill’s torturous progress, landlords could be forgiven for turning a blind eye to the proposed reforms. Despite the National Residential Landlords Association (NRLA) dubbing the Bill a “seismic shake-up of the private rented sector,” many landlords may be blissfully unaware of the Bill.
Yet the Bill, and its recent amendments, could be less dramatic than the rhetoric would have us believe.
Let’s step back from all the sound and fury and look at what the Bill originally set out to do, and what’s actually in it.
The Government has said that the Bill is intended to deliver on the Government’s commitment to bring in a better deal for renters.
The most significant of its measures, and the one that made the headlines, is the abolition of Section 21 ‘no fault’ evictions and a move to a simpler tenancy structure where all assured tenancies are periodic.
However, the Bill would introduce more comprehensive possession grounds so landlords can still recover their property – including where they wish to sell their property or move in close family. These would also make it easier to repossess properties where tenants are at fault, for example in cases of anti-social behaviour and repeat rent arrears.
The Bill also proposes a new Private Rented Sector Ombudsman to “provide fair, impartial, and binding resolution to many issues and prove quicker, cheaper, and less adversarial than the court system.”
It would see the creation too of a Privately Rented Property Portal. The portal’s objective would be to help landlords understand their legal obligations and demonstrate compliance – giving good landlords confidence in their position – alongside providing better information to tenants to make informed decisions when entering into a tenancy agreement. It would aim to support local councils – helping them target enforcement activity where it is needed most.
Tenants would have the right to request a pet in the property, which the landlord would have to consider and not unreasonably refuse. To support this, landlords will be able to require pet insurance to cover any damage to their property.
Proposed amendments
The Government has reiterated its commitment to the abolition of Section 21 ‘no fault evictions’. Housing Secretary Michael Gove has promised that they will be outlawed in England by the next general election.
But the Government has now proposed a delay in the abolition until the justice secretary publishes an assessment on the readiness of the court system to deal with repossession claims. It’s fair to say that this is unlikely to be a speedy process. Is this simply kicking the can down the road? The delay may give landlords some breathing space, though, in which to adapt to the change.
In a move that should be welcomed by landlords, the Government has also proposed making tenants commit to a minimum six-month period when renting a property, accepting a proposal by the cross-party Housing Select Committee that when fixed term tenancy agreements end, tenants be unable to give two months notice to leave until they have been in a property for at least four months.
In other welcome news, an additional proposed amendment would allow landlords to take back any type of student housing from student tenants at the end of the academic year. Landlords could then guarantee to prospective students that properties will be available to rent from the start of each academic year.
The Government has also now committed to reviewing the need for local authority licensing schemes as its proposed Privately Rented Property Portal could otherwise lead to duplicated property registrations.
What next?
It is now questionable whether the Bill will become law before the next General Election.
However, Labour has committed to banning Section 21 eviction notices “immediately” if it wins the election. Clearly, rent reforms are a matter of when, rather than if.
Whatever the timetable, landlords will need to familiarise themselves with the Bill. In our upcoming landlord sentiment survey, we will ask landlords about the Bill’s key measures and seek their views. It will be intriguing to see what landlords know, and to gain an insight into any hopes and concerns. We will report back.
Rob Stanton is sales and distribution director at Landbay
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