The Renters' Rights Bill has now been published. The bill, which, when it becomes law will be referred to as the Renters' Rights Act 2024, is the Labour Party’s response to rental reforms following the failure of the Tory government’s Renters Reform Bill just prior to the election and is a firm commitment to implementing their manifesto pledge to enacting reforms that have been tabled and talked about for years but have so far never seen the light of day.
Much of the bill is as before. There’s a day one commitment to the banning of notices to quit from landlords. The old bill saw amendments in this area that ultimately postponed the abolition of section 21 notices until (at least) an assessment of the county court system’s ability to cope with the section 8 procedure (under which possession claims must be heard by a judge) had taken place. Matthew Pennycook has said that government will work alongside the court system to ensure that by the time the bill becomes law it is ready to cope with the extra workload.
That said, the transitional provisions contained in the bill make clear that where a section 21 notice has validly been served prior to the commencement date, tenancies shall remain assured shorthold tenancies until either those proceedings have been concluded or until the section 21 (where no proceedings have been commenced) expires.
Like the old bill, there is a single system of periodic tenancies. Fixed term tenancies are abolished. It will not be possible for landlords and tenants to agree fixed terms even were they to each want one.
Under the new system, rent periods will be one month. Specifying a longer rent period will be of no effect.
For landlord who let flats in blocks, the terms of their lease shall automatically be read to allow sub-letting under the new system of assured periodic tenancies, allaying any concerns that they might otherwise be in breach of their insurance of head-leases.
Rent increases will be subject to the existing procedure under Section 13 Housing Act 1988. This procedure will however be modified so that tenants can challenge rent increases they consider too high, and challenge rents agreed at the outset of the tenancy (though they must do so within six months from the commencement of the tenancy otherwise they lose that right). As to the level of increases, the tribunal assessing the claim will decide the ‘open market’ rent and can specify from when the increase shall take effect – including up to two months after the decision in cases where where the tenant can demonstrate hardship. As for tenants’ notice, the position here largely reverts back to the first draft of the old bill. Tenants can give notice from day one of the tenancy provided their notice is at least two months long. Any rent paid in advance will be returnable for the period after the end of the tenancy.
The position for pets remains as before. Pets cannot unreasonably be refused by landlords, albeit they can ask for more information about the pet. Reasonable grounds for refusal are where a superior landlord lease would risk being breached. The Tenant Fee Act is modified to allow payment for additional premiums to protect the property from damage caused by the pet.
Again, there’s a requirement that landlords give a statement of terms; that they belong to a redress scheme (and unless they do belong to one they can’t market the property for letting) and that they register on the Private Sector database. These provisions are not fully-fleshed out in the bill but are subject to further clarification in regulations yet to be published.
All quite familiar so far. So, what’s new?
There’s a new provision preventing landlords from encouraging bidding wars. Landlords will be unable to advertise a property for letting unless the rent is a ‘specified amount’ (this applies to listings not boards). Landlords will be unable to accept an offer from someone to pay a rent that exceeds the amount of rent advertised in the listing (note that this should be the market rent otherwise tenants will be able to challenge it under the Section 13 procedure (see above).
Remedying of hazard provisions that were solely a feature of the social rented sector are, by a variation to the Landlord and Tenant Act 1985, now a feature of the private rented sector.
In terms of possession grounds under section 8, landlords will need to wait one year from the start of the tenancy before they can recover possession of the property for the purpose of either moving back into it (or moving a family member into it) or selling it.
Published just prior to party conference recess, the new bill carries an air of urgency about it. The government will be keen to demonstrate that they can deliver these reforms against a backdrop of delay from previous government and various housing ministers. Further regulations may follow relatively quickly and since the bill is largely familiar, we could well see it track through Parliament more rapidly than the old one.
The next reading will be 9 October.
Source: Our top lettings and legal experts at Foxtons are working through the bill to provide you with accurate, reliable information. This piece was authored by Manjit Kataora, our Director of Legal and Compliance, who will continue to analyse developments and track its progress for you.
There are a lot of sensational news stories around, but Foxtons remain committed to delivering practical, actionable guidance you can trust. Stay tuned to our blog for regular updates, expert insight and valuable insights that cut through the noise to help you navigate changes with confidence.
Fran Giltinan: The Renters' Rights Bill has been published, here’s what’s changed, what hasn’t and when you can expect it to become law.
First things first: this is the first draft. We can already see details that could change during debates. We’ve read every word of the bill to uncover any surprises so you don’t have to.
Secondly, a lot of this is not new. You’ll see many similarities and much of the preparation we’ve already done for Renters Reform will still apply. So, let's cut to the chase. here’s what you need to know now:
Gareth Atkins: Let’s start with new rules around initially letting out your property:
As expected, Section 21, fixed-term tenancies, Assured Shorthold Tenancies will be abolished. This has been in the pipeline for a long time and we are well prepared for it.
You will still be able to increase rent once per year with 2 months’ notice and You cannot t discriminate against renters for having children or being on benefits or having pets In the case of pets you can ask for Pet Insurance. Finally, rental bidding would be banned – so, you cannot let your property for more than the advertised price.
FG: Now, here’s what would change during the tenancy:
Firstly, you’ll need to join a landlord ombudsman scheme and a landlord database.
Next, If you a looking to re-gain possession of your property you still can.
If you want to sell or move in a close relative, you can do so after the first twelve months with four months notice. For arrears, you will be able to serve a Section 8 notice, for antisocial behaviour you can serve notice immediately and for student HMO’s you can now regain possession before the start of a new academic year.
Finally, the Decent Homes Standard will apply to the private rental sector as it currently does to social housing.
GA: As for the timeline of the Renters' Rights Bill, with Labour's majority, we’d expect the bill to progress swiftly. Currently we’d expect it to become law by next summer.
Foxtons top lettings and legal experts have been working through the bill to provide you with accurate, reliable information. We’ll continue to track it, analyse it and ensure our clients have everything they need to know as it comes.
