Understanding the Renters’ (Reform) Bill: What It Means for Landlords & Tenants

The Renters’ Rights Bill aims to reform England’s Private Rented Sector (PRS) by enhancing tenant protections and clarifying landlord responsibilities. The bill, which builds on the Renters (Reform) Bill introduced in the House of Commons by the Conservative government in May 2023, is expected to go into law around Easter 2025. 

The Renters Reform Bill is the predecessor of the Renters’ Rights Bill, which includes some “long overdue” reforms to give tenants more security and ensure they can leave substandard housing. The bill is a key priority for the newly elected Labour Government, which holds a substantial majority in the House of Commons. As a result, it is expected to pass with minimal changes. Let’s discuss the new provisions and what they mean for landlords and tenants.

What Are the Key Provisions to the Bill and Implications to Landlords?

1. Abolition of Section 21 ‘No-Fault’ Evictions

The bill eliminates Section 21 evictions, preventing landlords from terminating tenancies without providing a specific reason. All assured tenancies will now be periodic, offering tenants greater security. 

Implication: Landlords must rely on established grounds under Section 8 to regain possession, such as tenant rent arrears or property damage. This change aims to reduce arbitrary evictions and promote housing stability.

2. Introduction of Stronger Grounds for Possession

To balance tenant security with landlords’ rights, the bill revises possession grounds, making it easier for landlords to reclaim properties in cases like anti-social behaviour or repeated rent arrears. In the next section, we explain the mandatory and discretionary grounds for possession in further detail.

Implication: Landlords can address problematic tenancies more effectively, ensuring legitimate reasons are required for eviction.

3. Rent Increase Regulations

Landlords are now limited to increasing rent once per year, and any proposed increase must reflect market rates. Tenants have the right to challenge unjustified hikes through a tribunal, with the new rent taking effect only after a determination is made. 

Implication: This measure aims to prevent excessive rent increases, offering tenants financial predictability and a formal avenue to dispute unfair adjustments.

4. Establishment of a Private Rented Sector Ombudsman

A new ombudsman service will handle disputes between landlords and tenants, providing a streamlined and impartial resolution process without resorting to courts. 

Implication: Both parties gain access to a cost-effective and efficient mechanism for resolving conflicts, potentially reducing legal expenses and fostering better landlord-tenant relationships.

5. Creation of a Privately Rented Property Portal

The bill introduces a database for landlords to register their properties, enhancing transparency and aiding local authorities in enforcing standards. 

Implication: This initiative aims to improve property oversight, ensure compliance with regulations, and help tenants make informed decisions about their housing options.

6. Application of the Decent Homes Standard to the Private Rented Sector

Private rentals must now meet the Decent Homes Standard, ensuring properties are safe, in good repair and free from serious health hazards. 

Implication: Tenants benefit from improved living conditions, while landlords may need to invest in property upgrades to comply with the new standards.

7. Prohibition of Discrimination Against Tenants on Benefits or with Children

The bill makes it illegal for landlords and agents to discriminate against prospective tenants receiving benefits or those with children. 

Implication: This provision promotes equal access to housing, ensuring that vulnerable groups are not unfairly excluded from rental opportunities.

8. Ban on Rental Bidding

The new legislation prohibits the practice of rental bidding, in which tenants compete by offering higher rents. 

Implication: This aims to create a fairer rental market, preventing rent inflation driven by competitive bidding and making housing more affordable.

9. Strengthened Enforcement and Penalties

The bill enhances enforcement mechanisms, increases penalties for non-compliant landlords and strengthens rent repayment orders. 

Implication: Landlords are incentivised to adhere to regulations, knowing violations carry significant consequences, thereby protecting tenant rights.

What Are Common Grounds for Possession You Should Be Aware Of?

In the UK, landlords can regain possession of their property under specific legal grounds, which fall into two categories: mandatory and discretionary. These grounds vary depending on whether the tenancy is under an Assured Shorthold Tenancy (AST) or other rental agreements. Under the Renters’ Rights Bill, landlords must rely on Section 8 grounds for eviction rather than Section 21 “no-fault” evictions.

Mandatory Grounds (Court Must Grant Possession)

• Serious Rent Arrears: The tenant owes at least two months’ rent (or eight weeks if paying weekly).
  
• Owner Wants to Move In: The landlord or a close family member needs to live in the property.
  
• Mortgage Repossession: The landlord’s lender is repossessing the property.
  
• Repeated Serious Rent Arrears: Even if rent is paid later, a history of persistent late payments can justify eviction.
  
• Significant Breach of Tenancy Agreement: If a tenant damages the property severely or fails to meet key obligations.

Discretionary Grounds (Court May Decide to Grant Possession)

• Anti-social Behaviour: The tenant has engaged in harassment, drug-related activities or other criminal offences on the property.
  
• Property Deterioration: The tenant has caused serious damage beyond normal wear and tear.
  
• Breach of Tenancy Terms: For example, subletting without permission or keeping pets when not allowed.
  
• Persistent Late Rent Payments: Even if rent is eventually paid, repeated late payments can be grounds for eviction.
  
• Landlord Intends to Sell: If the landlord needs to sell and cannot do so with the tenant in place (under new proposals in the Renters’ Rights Bill).

Frequently Asked Questions for Landlords

1. Can I still evict tenants under the new bill?
   

Yes, but “no-fault” evictions under Section 21 are being abolished. Instead, landlords must use Section 8 grounds, such as rent arrears, property damage, or wanting to sell/move in. The bill strengthens some eviction grounds, making removing tenants for persistent arrears or anti-social behaviour easier.

2. How will rent increases work under the new law?
   

Landlords can only increase rent once per year, and tenants can challenge excessive increases through a tribunal. Any proposed rent hike must be in line with market rates to prevent unfair pricing.

3. Will I need to register my rental property?
   

Yes, the bill introduces a Private Rented Sector Database, requiring landlords to register their properties. This aims to improve transparency and ensure compliance with legal standards.

4. What happens if my tenant stops paying rent?
   

Landlords can still evict tenants for rent arrears, particularly if they have missed two months’ rent. The bill strengthens eviction rules for persistent late payments, making it easier to remove problematic tenants.

5. Will it be harder to sell my rental property?

If you want to sell with tenants in place, you may need to wait for them to leave or use a valid possession ground. The bill aims to balance tenant security with landlord rights, but landlords may need to plan sales more carefully.

The Renters’ Rights Bill represents a significant shift in the rental landscape, aiming to balance tenant protections with landlords’ interests. While tenants gain more security and rights, landlords must adapt to stricter regulations and oversight. Both parties are encouraged to familiarise themselves with these changes to navigate the evolving rental market effectively.

If you need help, contact Burt Brill & Cardens today for expert guidance on commercial properties or residential housing. Ring us on 01273 604 123, email us at enquire@bbc-law.co.uk or make an enquiry.