The Renters’ Rights Bill will change the landscape in which private tenants rent properties from landlords.

As at Oct 24, the basic changes are as follows:

• Abolish “no fault” evictions. It will abolish Sec. 21 notices, which on the face of it will substantially weaken a landlord’s ability to get possession of their property back whenever they want it.
• No discrimination against prospective tenants on benefits or with children. It will also make it illegal for landlords to discriminate against tenants in receipt of benefits or those with children.
• Abolish fixed-term tenancies. All tenancies to become periodic with no more than a month at a time for the periods. Tenants can serve two months’ notice to end the tenancy, at any time, and via any written method.  Therefore, all tenancies will be no more than 2 months’ certain.
• New ‘Landlord circumstance’ grounds. A new ground where the landlord needs to sell will be introduced, as well as an amended ground where the landlord or their family needs to move in. Landlords won’t be able to use these grounds in the first 12 months of a tenancy and will need to give four months’ notice. It is yet to be seen what evidence a landlord will need to demonstrate that they genuinely intend to move in or sell their property. The government has stated that the legislation will not prescribe this and it will be up to the courts to clarify the parameters. One wonders how long the Courts will take to do this. However, the government will put in place various restrictions on marketing the property for re-letting within a certain time period after regaining possession to prevent landlords from falsely claiming they want to move back in or sell as a ruse to get their property back.
• Mandatory rent arrears ground amended – requiring three months’ arrears (up from the current 2 months) and four weeks’ notice.  So, in effect, 4 months’ rent arrears, minimum.
• Ban rental bidding wars – landlords and agents will be prevented from asking for or accepting offers above the advertised rent.
• Limit in-tenancy rent rises to a single annual increase capped to whichever is lowest of market rates or the amount proposed by the landlord. Landlords must give two months’ notice. Tenants can challenge this via the First-tier Tribunal. Any increase can’t happen until the tribunal’s made its decision.  It seems likely that the Tribunals won’t have sufficient resource to deal with this effectively and efficiently and decisions may take some time, during which the original passing rent remains in place. This in turn may lead to tenants owing monies on any possible increase and landlords having to secure said monies.
• Pets – Gives tenants increased rights to request consent for pets, which landlords must consider and not refuse unreasonably. Landlords can require tenants to obtain or contribute towards pet insurance to cover any property damage.
• Introduce a Decent Homes Standard to the private rented sector with fines of up to £7,000 for failing to meet standards.
• Extend Awaab’s Law to private renting – setting clear timeframes within which landlords must make homes safe where they contain serious hazards.
• Private Rented Sector Database – Requires landlords to register on a database and a landlord will usually be unable to terminate any tenancies unless it is registered.
• Private Rented Sector Legal Ombudsman – Introduces a new ombudsman which will deal with landlord and tenant disputes.
• Local authority enforcement – give local authorities greater powers to investigate and enter PRS properties and substantially increase the financial penalties for non-compliance.

In addition, we understand that the Government proposes to abolish the Accelerated Possession Procedure option.

It is also proposed that this Bill will be retrospective, i.e. once it comes in to play, all of the above will then apply to existing ASTs.

(Thanks go to Stephen Burke of TaylorWessing solicitors for most of the above).

Link to the Government website is here:
https://www.gov.uk/government/publications/guide-to-the-renters-rights-bill/82ffc7fb-64b0-4af5-a72e-c24701a5f12a

Many landlords will thus further reassess the attractiveness of ASTs. As it is, being a landlord isn’t always financial rewarding, and the legal framework around it is going to become even more tenant friendly, to the detriment of landlords in general.

Frankly, one might reasonably ask that for many landlords ASTs must be rapidly losing their lustre.