By Suzanne Elliott, Multimedia ProducerThe Renters’ Reform Bill is set to be "the biggest shake-up of the private rented sector in a generation," according to the government.
The bill could change the landscape of renting, with the changes likely to have a big impact on landlords and tenants.
The plans outlined in the long-awaited bill include scrapping no-fault evictions, ending fixed term contracts, outlawing arbitrary rent rises and making blanket bans on renting to families with children or tenants who receive benefits illegal.
The bill could also stop landlords banning tenants from keeping pets.
Campaigners hope the overhaul of renting rules will improve standards for 11 million tenants in England and give greater security to renters.
Here we look at some of the main proposals and how they could impact you.
'No fault' evictions could be banned
Under the new proposals, a landlord will not be able to evict a tenant without giving a reason - and it will not just be their decision. A court will ultimately judge whether the landlord has a valid reason (which will be defined in law).
Currently, section 21 notices allow landlords to terminate tenancies without giving a reason.But the Renters’ Reform Bill will abolish landlords’ right to ask tenants to leave the property through no fault of the renter’s own.
This means, a tenancy can only end if a tenant ends it, unless the landlord has a legally watertight request.
Laws improving the rights of renters are being presented to Parliament - but what do they include and how will things change for tenants and landlords?
According to government figures, more than a fifth of private renters who moved in 2019 and 2020 did not end their tenancy by choice.
Housing Secretary Michael Gove said the Renters’ Reform Bill will allow tenants to challenge substandard landlords without losing their home. According to a government research briefing, there is evidence that tenants are reluctant to ask for repairs or challenge rent increases for fear of eviction, which this bill seeks to rectify.
But while section 21 no-fault evictions would be banned, the reforms would also strengthen landlords’ rights to throw out tenants for antisocial behaviour.
In fact, the government says the bill will “strengthen landlords’ grounds for repossession” making it easier for them to evict difficult tenants.
Currently, most tenants sign a fixed term contract, usually lasting 12 months.
These would be binned as part of these sweeping plans and all tenancy agreements would become "rolling," in an effort to give tenants greater security and flexibility.
The rule change would also make it easier for renters to move when they like without being liable for outstanding rent.
Tenants would instead give two months' notice when they want to move out.
This means, a tenancy can only end if a tenant ends it, or a landlord has a valid reason (which will be defined in law).
When will the reforms take effect?
This bill is in its infancy and has a long way to go before it becomes law.
It is being introduced to Parliament on Wednesday, May 17, and then will wind its way through the Lords. The bill, or parts of it, may be challenged and changed.
A Private Renters’ OmbudsmanThe Bill proposes a new ombudsman be created to act in disputes between private renters and landlords.
The ombudsman will cover all private landlords who are letting out properties, and will also ensure that landlords act when a resident has made a complaint.
There will be resources in place, including a new property portal designed to help landlords understand their responsibilities.
The portal will also give tenants the information they need to tackle rogue landlords and agents, and help councils crack down on poor practice.
Ending blanket ban on renting to benefit claimants and families
The bill seeks to outlaw bans on renting to families with children or those who are in receipt of benefits, something campaigners have been calling for for years.
Ending rent hikes
The bill will, for the first time, end arbitrary rent review clauses in tenancy agreements.
Landlords will only be allowed to raise rent once a year.
Tenants will also be able to claim back rent if the property is below standard.
The Renters' Reform Bill doubles notice periods for rent increases and also gives tenants more powers to challenge rent rises if they are unjustified.
‘No pet clauses’ are common in many tenancy agreements but the Renters' Reform Bill will give all tenants the right to ask to keep a pet in their home.
Landlord “cannot unreasonably refuse”, under the proposed rules.
This may not always be the landlords' decision; if a tenant is renting in a block of flats, for example, the landlord may be restricted by the leaseholders' or housing association's rules.
If the landlord does give a tenant the nod to keep a pet, they will be within their rights to ask them to take out pet insurance.
Councils will have more powers
Councils will be given great powers to tackle rogue landlords in a bid to rid the sector of the worst offenders.
Fines for serious offences will be increased and greater enforcement powers will help local authorities tackle poor housing for tenants. What do landlords think?
Many landlords are broadly supportive of the changes, but increased legislation - as well as tax changes - have seen many landlords sell up.
Some advocates claim the pace of these changes, along with rising mortgage interest rates, will prompt a landlord exodus, leaving fewer rental homes and squeezing rental supply further.
They have warned increased demand for a shrinking supply of homes could trigger higher rents.
Chief executive of the National Residential Landlords Association, Ben Beadle said: “Whilst headline commitments to strengthening possession grounds, speedier court processes and mediation are helpful, the detail to follow must retain the confidence of responsible landlords, as well as improving tenants’ rights."
He continued: “The eventual legislation needs to recognise that government actions have led to a shortage of supply in the sector at a time of record demand. It is causing landlords to leave the sector and driving up rents when people can least afford it.”
But campaigners argue that rent hikes are avoidable, with a quarter of landlords not having a mortgage for their buy to let, according to the English Private Landlord Survey 2021.Generation Rent, who campaign for tenants' rights and have longed called for the end of section 21 evictions, welcomed the white paper, but said tenants were still vulnerable to rent rises and warned landlords may be able to “circumnavigate” the rules by using large rent hikes to force unwanted tenants out.
"Two months’ notice of a rent increase (up from one) will give tenants more time to challenge it and while the tribunal can’t award more than what the landlord wants, this may encourage landlords to ask for as much as they think they can get away with – an unintended consequence," the group said.
"As things stand, landlords in areas with high demand for homes could easily use unaffordable rent rises to force tenants out so to stop this there needs to be a limit to rent rises based on affordability."
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