The Renters Reform Bill: What You Need To Know

The Renters’ Rights Bill is currently in its second reading in the House of Lords. Whilst timescales remain unconfirmed , guidance indicates that we could see changes implemented as early as Spring.

The changes that have been confirmed/proposed to date include:

1. ASTs (Assured Shorthold Tenancies) will become periodic tenancies and will be known as Assured Periodic Tenancies, which are monthly agreements. Tenants will be protected for 12 months during which time the Landlord cannot attempt to sell or regain occupancy of the property.
2. When the Bill is formally introduced, there will be an adjustment period before it is legally enforced to allow agents to prepare.
3. It has been proposed that existing and new tenancies will all convert to the new legislation at the same time, in the interest of fairness. However, the Lettings Industry Council are requesting a phased approach for existing tenancies due to the volume of them.
4. The abolishment of Section 21 notices.
5. Landlords can increase the rent once a year, but this must be in line with local market rent and evidence of this must be provided. Tenants can dispute the evidence by applying to the First-tier Tribunal.
6. It will no longer be possible to accept or to offer rents over the advertised price.
7. Landlords could face fines if found to be in breach of the terms outlined in the Bill. The fines can range from ￡7,000-￡40,000.
8. Tenants will have the right to request permission to keep pets. Landlords cannot unreasonably refuse permission, however they can request that the tenant obtain insurance specifically to cover potential damage caused by the pets.
9. The mandatory threshold for eviction will increase from 2 months’ to 3 months’ rent arrears and the notice period will increase from 2 weeks to 4 weeks.
10. Tenants have an initial 12 months’ protection and landlords must give 4 months’ notice to evict them or to sell the property. From Month 12, the notice period required will depend on the situation and if grounds for possession are applicable, but will range from 2 weeks to 4 months.
11. Requests for advanced rental payments will be prohibited once the lease is entered into – this may result in higher deposits or additional guarantees.
12. Landlords will have to pay to register themselves and their property on a database. Tenants will be able to access and review the properties within this database, offering increased transparency.
13. Landlords will no longer be able to discriminate against families with children – they will be required to provide evidence as to why the family was not accepted (e.g. overcrowding).
14. Awaabs Law – Meeting timescales for hazards such as mould and damp will apply to all APTs, not just the social rented sector.
15. Rent Repayment Order – Tenants can apply to the First-tier Tribunal for this if the landlord has committed an offence, such as misusing grounds for possession or entering false information into the PRS Database. The maximum amount of rent a landlord can be ordered to pay back will double from 12 to 24 months.

Non-Housing Act and Company leases will remain unchanged. At this juncture, landlords are more likely to favour Company leases due to the new restrictions that will most probably be imposed under the Bill. K2 will continue to monitor the Bill closely and will provide updates as and when we receive them.

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