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Last October 9, 2024, the Renters’ Rights Bill completed the Second Reading stage with Deputy Prime Minister Angela Rayner presiding. Since the bill was addressed in Parliament, the other parties had the chance to debate the details. While it’s still a long way from being passed, the target is to pass it into law by Spring 2025.
Why should property owners and landlords pay attention?
Although the Renters’ Reform Bill was created to protect tenants, it affects the compliance requirements of rental properties in London. If it passes, the bill will legally define what it means to be a “good” landlord. So if you want to stay compliant, keep reading.
In this article, you’ll understand the bill and the 12 objectives you should focus on as a property owner or landlord. You’ll get insights on how it will affect existing tenancies and what you can do to align with the details of the new regulations.
About the Renters’ Rights Bill 2024
The Renters’ Rights Bill 2024 is designed to address key issues in the UK rental market. The reforms seek to reshape the rental market landscape, specifically in the private sector. It will deal with common issues like tenant vulnerability and inconsistent landlord practices.
Let’s take a look at the background and objectives of this bill.
Background of the Bill
The Renters’ Rights Bill takes after the Renters Reform Bill of the Conservative government. This bill provides the most significant tenant protection in 30 years. At the moment, unaffordable homeownership is pushing the demand for rental properties higher. With the rental market still struggling to keep up with a demand that’s twice as high as pre-pandemic levels, regulations are needed to ensure tenants won’t be left at a disadvantage.
The government went through consultations and gathered insights from tenants, landlords and housing policy experts to determine the key issues the bill should focus on. Among the specific issues tenants struggle with include no-fault evictions, unjust rental hikes and inferior living conditions. These are concerns the bill would like to address.
Main Objective of the Bill
While the priority is to secure tenants and their right to a safe and secure home, the bill also seeks to improve housing standards and establish a balanced tenant-landlord relationship. The consultations ensure the bill adopts a collaborative approach to create a mutually beneficial law in the private rental market.
The objective is to enhance the quality of life for tenants while setting consistent standards for landlords. It also provides clear guidelines for reclaiming properties and protecting the rights of both tenants and landlords.
The Renters’ Rights Bill will also empower local authorities to enforce the law and ensure the right rental housing standards are always upheld.
In the end, the bill seeks to create a stable and fair rental market where tenants are secure and landlords remain confident in their right to rent their properties.
12 Objectives of the Renters’ Rights Bill 2024
The Renters’ Rights Bill 2024 has 12 key objectives. Each objective reflects the government’s commitment to reshaping the rental market into a stable, fair and transparent one. It offers a guideline for both tenants and landlords so they’re both aware of their rights.
As a property owner and landlord, it’s important to understand these objectives so you can stay compliant with rental regulations. Here are the 12 key objectives that’ll influence the UK rental market once it passes into law.
Eliminate Section 21 evictions
One of the significant aspects of the bill is the abolishment of Section 21 or the “no-fault” evictions. This currently allows landlords to evict tenants without providing a specific reason. This leads to tenant insecurity and keeps them from challenging unfair landlord practices for fear of being evicted.
Under the Renter’s Rights Bill, Section 21 will be eliminated and a simpler tenancy structure will be implemented in one stage (for quicker implementation). This new structure makes all assured tenancies periodic to empower tenants if there’s a need to challenge landlords for unfair practices.
Create fair possession grounds for tenants and landlords
The bill prioritises tenant security but it also provides landlords with clear guidelines to reclaim their property if there’s a reasonable need. The bill enumerates a list of legitimate reasons known as the grounds for possession and this includes moving back in, selling, etc. Each reason comes with security measures for the tenant.
For instance, if the reason is occupation by the landlord or family, the tenant should be given a notice of 4 months before eviction. Some reasons cannot be used for the first 12 months of a tenancy. This gives tenants security and enough time to find alternative housing options without compromising the landlord’s rights to use their property for their benefit.
Protect against backdoor evictions
An example of backdoor eviction is an excessive rent increase that forces tenants to leave an unaffordable property. The bill will enforce stronger safeguards against these practices to protect tenants. While landlords can still adjust rent, they’re tied to the fair market price.
This bill also gives tenants the ability to challenge rent increases and file disputes through an independent tribunal set by the local authorities.
Establish a Private Rented Sector Landlord Ombudsman
The bill will introduce the Private Rented Sector Landlord Ombudsman Service which all private landlords (including those using a managing agent) will be legally required to join. Failure to do so could lead to civil penalties. This could range from up to £7,000 (for initial breaches) or up to £40,000 and criminal prosecution (for repeat breaches).
Tenants can freely use this service to file complaints against unfair landlords. The ombudsman will provide fast, impartial and legally binding resolutions for tenants. At the same time, landlords will also access guidance and support services from the ombudsman to improve their ability to handle tenant complaints.
Setup a Private Rented Sector Database
The bill includes the mandatory creation of the Private Rented Sector Database to improve transparency. This is a central registry where landlords should confirm compliance with their legal obligations. Joining this database will give landlords the right to use specific possession grounds.
This allows good landlords to demonstrate their commitment to providing fair rental practices. Tenants can access this database to help them make decisions about rental agreements. Local councils can also use this database to monitor and enforce rental laws and regulations.
Support the right to have a pet on the property
Pets are specially mentioned in the Renters’ Rights Bill. It gives tenants the right to request lodging for their pets in rental properties. Landlords can no longer deny these requests but they can add terms to protect their properties from possible damages.
For instance, they can request pet insurance to cover potential damages. If the tenant is willing to comply with the landlord’s reasonable demands, the latter cannot refuse pets from living in the rented property.
This will give pet owners more accommodation options in the UK rental market.
Implement the Decent Homes Standard
The bill will extend the Decent Homes Standard to private rental landlords where they will be required to maintain safe and well-maintained properties. This will give tenants comfortable and high-quality homes that are free from hazards. It will also improve the value of private rental properties and minimise poor-quality housing. Landlords will be legally required to improve their rental properties to meet the standards required in the social housing sector. It won’t just improve property values, it can also uplift local communities.
Enforce Awaab’s Law
Awaab Ishak was 2 years old when he passed due to high exposure to moulds in their rented home. The Renters’ Rights Bill includes the enforcement of Awaab’s Law to set strict guidelines against serious safety hazards.
Private landlords are legally required to address severe damp or mould issues within a specific timeframe. This protects tenants from hazardous living conditions and keeps landlords responsible for maintaining safe and clean homes.
Prohibit rental discrimination
Private landlords can no longer discriminate against tenants based on their status. For instance, tenants receiving benefits or those who have children should be given equal rights to get fair rental agreements.
This strengthens the government’s commitment to promote equality in housing. It also ensures that anyone has the right to secure a home, regardless of their financial or family situation. It leads to a more inclusive rental market, something that the UK government is serious about implementing.
Ban rental bidding
Rental bidding is the practice of accepting higher offers compared to the advertised rental price. For instance, a property is advertised with a rental price of £2,000 a month. Although tenant A got in touch with the landlord first, tenant B came with an offer of £2,250 per month. The landlord cannot accept tenant B just because they offered a higher rent. The landlord is legally mandated to stick to the listed rent price.
This promotes transparency and accountability among private landlords and eliminates the practice of “price wars” to secure rental properties.
Impose local authority enforcement
The Renter’s Rights Bill will strengthen the enforcement power of local authorities to uphold the new standards set by the new legislation. It includes the provision of investigative tools to ensure fair practices are enforced. It will also oblige the local council to provide public reports to maintain transparency of their enforcement practices. This is meant to minimise oversights and ensure compliance while keeping tenants aware of enforcement activities.
Combined with the penalties, the bill hopes this will encourage compliance among landlords.
Improve rent repayment orders
The bill will strengthen the Rent Repayment Order to cover even superior landlords and increase the penalty for violations. The rent repayment is part of the tenant’s protection from abusive landlords. Once proven that landlords have violated the rules, they will be asked to repay the rent given by the tenant as a penalty. The expansion of the Rent Repayment Orders will hopefully minimise the violations.
How The Renters’ Rights Bill Affects Existing Tenancies
As a property owner and landlord in the UK, how will the Renters’ Rights Bill affect you, specifically existing tenancy agreements?
Once the bill passes into law, it will apply to both new and existing tenancies. The government is intent on implementing it in one stage to ensure that tenants and good landlords will already benefit.
Here are tips you can use to prepare for this bill’s passing.
- Review tenancy agreements. Take note of tenancy agreements that need updating to comply with the new structure imposed by the bill.
- Think of fair possessions plans. Existing and new tenants will enjoy the same protection against a landlord’s possession grounds. Create a strategy to accommodate longer notice periods if necessary.
- Check for compliance with the Decent Home Standard. Have your properties checked to stay within the standards imposed on social housing. Conduct regular inspections and act on maintenance issues promptly.
- Prepare to submit to the Ombudsman Process. Research the possible requirements and processes needed to submit to the new ombudsman service. Make sure all your records are complete and issues are dealt with accordingly.
Learn More About Your Rights as a Landlord
While the Renters’ Rights Bill 2024 is focused on tenants, landlords will also benefit from it as long as they are good and fair with their tenants. Be proactive in keeping up with this bill as it will bring significant changes in the UK’s rental market sector. Make sure you understand the bill’s requirements so you can prepare for the transition once it passes into law.
If you need more information about your rights as a private landlord in the UK, get in touch with us. City Relay is a property management company with expertise in property compliance. Our property management services will align your property with the latest legal standards.
