The Renters’ Rights Bill is due to come into force in October 2025. This is reported to be the biggest change to landlord and tenant law since the introduction of the Housing Act 1988.
Abolishment of Section 21 and amendments to Section 8
The Bill is set to introduce further grounds to the Section 8 process due to the abolishment of the Section 21 ‘no fault’ eviction.
The new grounds will include:
1. The landlord and/or their family wish to occupy the property
2. The landlord wishes to sell the property
3. Properties rented to students for occupation by new students
4. The landlord holds a long lease which will end within 12 months of the notice being served
5. The property was let in consequence of tenant’s employment by the landlord / previous landlord or pursuant to an agreement between landlord and employer and the tenant is no longer employed
6. The property was let for the purpose of supported accommodation and the tenant is no longer receiving care, support, or supervision and/or the support can no longer be provided
7. The landlord intends to demolish or reconstruct the whole or a substantial part of the dwelling or carry out substantial works on the dwelling and any part and the intended work cannot reasonably be carried out with the tenant giving up vacant possession
8. Breach of licencing requirements or Local Authority Notices
9. The tenant has died, and the interest has passed to the new tenant under a will or intestacy.
Most of the current grounds in the Section 8 process will remain available for landlords. However, the notice periods are set to change.
For example, to seek possession currently on the mandatory Ground 8 based on rent arrears, the notice period is two weeks based on arrears of above two months/eight weeks. This is set to increase to a four week notice period based on three months/13 weeks of rent arrears.
It is worth noting that, Ground 8 has been amended to include provisions for housing benefit. If the tenant is only in rent arrears due to the local authority not paying the tenant’s housing benefit or is late with paying the housing benefit, a notice relying on the mandatory Ground 8, cannot be served. The tenant must be in rent arrears despite and in addition to, any Local Authority payments.
The abolishment of the Section 21 process may be beneficial for landlords as it will dispense with the requirements to provide gas certificates, energy performance certificates, How to Rent Guides and electrical installation certificates to seek possession. However, this does not dispense with the requirements for landlords to ensure that their rental properties are safe and to comply with separate legislation which requires landlords to have these documents and ensure they are kept up to date.
If a landlord had failed to comply with the requirements under the Deregulation Act 2015 relating to gas certificates, energy performance certificates, How to Rent Guides and electrical installation certificates, this was an automatic defence to a Section 21 claim for possession. However, the only statutory defences that are now allowed under the Renters’ Rights Bill are:
1. Any deposit breaches i.e., failure to protect a deposit within a scheme and/or failing to serve the deposit prescribed information both within 30 days of receipt of the deposit.
2. The landlord failing to be registered on the landlord’s database (further information below)
3. Equality Act 2010 discrimination defences
Tenancy agreements
The Renters’ Rights Bill will convert all fixed term assured shorthold tenancies (ASTs) to periodic tenancies overnight. Any fixed-term tenancies that are signed now will be affected by this when the Bill becomes effective so landlords and tenants should be wary and seek advice before entering into any new ASTs.
Rent reforms
Currently, landlords can include provisions in tenancy agreements that gives them permission to increase the rent.
This will no longer be the case once all ASTs become periodic tenancies. If a landlord wishes to increase the rent, this must be done by serving a Section 13 notice which then has to be agreed by the tenant or, set by the First-tier Tribunal in the absence of the tenant’s agreement.
In addition, the Bill will prevent rental bidding on properties. Landlords must list the property for an advertised rental amount which is then the maximum the landlord can accept as rent for the property. This is to prevent landlords accepting a rent that is higher than market value simply because a tenant offered this to secure the property.
The introduction of the Tenant Fees Act 2019 limited fees that landlords and/or agents could take from tenants. The Bill will introduce a further ban, within the Tenant Fees Act 2019, on rent being payable in advance unless this relates to the first month’s rent, but this cannot be taken before the tenancy commences.
Regulation reforms
The Bill will introduce a requirement for landlords to register for a new Landlord’s Ombudsman which will offer a free redress scheme for tenants.
This will likely mean greater local authority involvement including ensuring that landlords have complied with their new duty register with the Ombudsman and to deal with the redress scheme enforcement.
The Bill will also require landlords to register for a Private Rented Sector (PRS) database. This is likely to include a requirement for landlords to upload key documents on a website i.e., gas certificates, energy performance certificates and electrical installation certificates. There is likely going to be a fee for registering which landlords will have to incur. There has been a proposed staggered approach to this requirement to prevent all landlords registering their properties at once. Landlords will be unable to market properties for rent unless they are registered.
Under the Renters’ Rights Bill, landlords will be unable to reject tenancy applications on the basis of potential tenants having children, being in receipt of any state benefits or having pets. Any objection to this must be justified and permission cannot be withheld without proper reasons.
Repairing rights reforms
The Renters’ Rights Bill will extend the new Awaab’s law to the PRS. However, this is unlikely to come into effect immediately with the Bill. There was a three year transition period when this was introduced to social landlords so a further transition period for private landlords is suspected to be implemented.
The Renters’ Rights Bill aims to improve the PRS by introducing the Decent Homes Standard (DHS). This is to ensure properties are in a reasonable state of repair and meet minimum standards, alongside other tenant protections. This standard, originally for social housing, will now apply to the PRS, ensuring properties are in a reasonable state of repair, have reasonably modern facilities, and provide a reasonable degree of thermal comfort. This will again mean further involvement for local authorities if reports are made by tenants that this is not being met. It has been suggested that local authorities will have the power to enter properties potentially without notice and immediately issue penalties for DHS failures. In addition, this will presumably form a ground of complaint to the new redress schemes.
Transition period
It is suspected that a transition period will be put into place for the first three months from October 2025. A valid Section 21 notice served before the commencement date of the Bill can be relied upon in proceedings issued after the commencement date. However, such proceedings must be issued within three months of the commencement date or six months of the notice being given (whichever is earliest). If the date given in the notice after which possession is required is three months after the commencement date, it is not possible to issue the claim based on this notice.
It is clear that the Renters’ Rights Bill will implement a substantial number of changes and both landlords and tenants will need to be aware of such changes and how this affects them. It is likely that further guidance and assistance for both landlords and tenants will be introduced as the implementation of the Bill approaches.
At Stephensons we have a specialist landlord solicitors who deal with a range of issues relating to renting properties and renters' rights. If you would like to speak with a member of our team please call us on 0161 696 6170.
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