Renters Reform Bill moves to House of Lords

After months of waiting the Renters Reform Bill finally passed its third reading in the House of Commons yesterday, Coverage for the Bill has been widespread in the national press and trade press, some of which has been inaccurately reported.

Abolishing Section 21

This WILL happen. It is a manifesto commitment and the Housing Minister stressed that six months’ notice (a transitionary period) before ending section 21 tenancies to give the sector some time to implement these changes. There is a continued commitment to improving the  county court system to adjust to the new possession processes.

Key Changes

The Bill will deliver the most significant changes to the rental sector in 30 years and will:-

• Prevent landlords from implementing blanket bans on renting to tenants with children or tenants in receipt of benefits

• Apply and enforce the Decent Homes Standard to the private rented sector for the first time, so that everyone has a safe and decent home

• Allow tenants to have a legal right to rent property with pets providing they adhere to the criteria set down by law (prove they have the relevant pet insurance)

• Provide landlords with strengthened grounds for possession if a tenant is in rent arrears, they want to sell their property or move back into the property

• Have additional grounds so landlords are able to act more quickly to evict tenants who cause anti-social behavio

• Introduce a new Private Rented Sector Landlord Ombudsman

• Introduce a nationwide (England) Property Portal

Into the Detail of the Renters Reform Bill

There are also elements of the Bill that have not been widely discussed, yet will have an impact on landlords and tenants.

• Extension of Awaab’s law to the private rented sector. This amendment would require private landlords to deal with hazards affecting their properties.

• A limit on the maximum amount of rent that could be lawfully requested by a residential landlord in advance of a tenancy commencing would be 5 weeks’ rent for tenancies of less than £50,000 per annum and to 6 weeks’ rent for tenancies over £50,000 per annum.

• Expanding the remit of rent repayment orders to company directors that would enable local housing authorities to impose financial penalties on certain individuals when it believes a housing offence has been committed by a body corporate.

• Guarantor to have no further liability following death of tenant which would mean that guarantors in relation to a tenancy have no liability for future matters arising from the tenancy after the tenant has died.

• The prohibition of landlords from requiring prospective tenants to provide rent guarantors or equivalent upfront payments, and prohibit them from prioritising prospective tenants who offer them over those who do not.

• In instances where a private landlord increases the rent without issuing a section 13 or section 13A notice the tenant can seek to recover costs through a debt claim in the court. It also provides the government with the power by regulation for such claims to be recoverable by tribunal.

• A new section to the 1988 Act which allows a tenant under an assured tenancy to challenge the validity of a notice to increase the rent in the First-tier Tribunal (instead of in the county court, which is currently the forum for such challenges).

• Tenants cannot give notice to quit until they have resided in the property for at least four months.

As the Bill goes through the House of Lords, there will no doubt be additional amendments and tweaks being made, however, one thing is clear that as Royal Assent approaches, the most important point to bear in mind is to ensure that landlords and letting agents are prepared.