Introduced on 11th September 2024, the Renters' Rights Bill promises significant reforms to the private rental market, focusing on enhanced tenant protections.
The bill completed its passage through the House of Commons on 14th January 2025 and had its first reading in the House of Lords the following day. Its second reading is scheduled for 4th February. While still subject to amendments, the bill is expected to become law by mid-2025, with potential enactment as early as late spring or summer.
A recap on what we know from the earlier readings
Key Reforms in the Bill
- Abolition of Section 21 ("No-Fault" Evictions) – The most impactful reform is the abolition of Section 21, which currently allows landlords to evict tenants without providing a reason. Once the bill passes, landlords will only be able to evict tenants using newly proposed Section 8 Grounds, such as rent arrears or selling the property. Landlords will need to familiarise themselves with these new grounds and the updated possession timelines to regain their properties.
- Possession Grounds Update – A one-year waiting period will be required before a landlord can repossess a property to either sell it or move in a family member.
- End of Fixed-Term Tenancies – All tenancies will shift to monthly periodic tenancies, ending the use of fixed-term agreements. This will apply to both new and existing tenancies, with no transitional phase for current contracts. To end a tenancy, tenants must give two months' notice, and landlords are restricted from serving notice during the first 12 months unless the tenant is at fault.
- Rent Increases – Rent increases will be capped at once per year, and landlords must give tenants two months' notice of any increase. The increase must align with market rates, which can be contested by tenants through a First-tier tribunal if they believe the increase is excessive. This gives tenants greater stability in budgeting, while landlords must ensure rent adjustments are fair and justifiable.
- Landlord Ombudsman – A mandatory Landlord Ombudsman Service will be introduced, and landlords will be required to join. This service will allow tenants to lodge complaints about their landlord, with binding resolutions offered. The aim is to provide tenants with a fair and impartial recourse to address grievances.
- Private Rented Sector Database – All landlords must register themselves and their properties in a new Private Rented Sector Database. This will help ensure that landlords comply with their legal obligations and responsibilities, and the database will be accessible to local councils for enforcement purposes.
- No Blanket Rental Discrimination – Landlords will not be able to refuse tenants solely because they receive benefits or have children. Any restrictions in mortgages, superior leases, or insurance policies requiring such discrimination will be rendered ineffective. Decisions to refuse a tenant based on these grounds will need case-by-case justification.
- Prohibition of Rental Bidding – The bill seeks to curb rental bidding wars by prohibiting landlords from accepting offers above the advertised rent. Landlords and letting agents will be required to publish a specified rent, which should reflect the property’s market value.
- Pets in Properties – Tenants will have the right to request permission to keep pets, and landlords cannot unreasonably refuse. While landlords can require tenants to hold insurance or take responsibility for pet-related damages, blanket bans on pets will no longer be allowed.
- Decent Homes Standard and Awaab’s Law – The Decent Homes Standard, previously applied to social housing, will now cover the private rental sector. This standard sets minimum requirements for properties to be safe, habitable, and free from serious health hazards. Coupled with Awaab’s Law, landlords will be required to address serious hazards such as mould and damp within a strict timeframe or face penalties.
- Rent Repayment Orders – The bill also strengthens Rent Repayment Orders, expanding their applicability and coverage. New offenses in the bill could trigger repayment orders, increasing compliance and accountability across the rental sector.
Recent updates following the House of Lords
The amendments introduced during the Renters' Rights Bill's progression include new provisions surrounding rent payments:
- Rent Periods: Landlords are prohibited from enforcing tenancy agreement terms that require rent payments exceeding one calendar month.
- Advance Rent Payments: Landlords cannot demand more than one month's rent in advance, preventing the practice of requiring multiple months upfront.
- Pre-Tenancy Rent Payments: Landlords and agents are barred from accepting rent payments before a tenancy agreement is signed, aligning with the Tenant Fees Act to prevent pre-tenancy rent collection.
Additional changes that were put forward include:
- Timing for entering into Student Agreements: If a student tenancy was agreed more than 6 months in advance of the tenancy starting then the landlord cannot rely on the Section 8 Ground 4a (Properties rented to students for occupation by new students) to evict them.
- Protections Guarantors following the death of a tenant: The new clause (21) limits the liability of guarantors for rent in the event of a tenant’s death in specified circumstances and provides that where the deceased tenant was the sole occupant, the guarantor cannot be held liable for rent accrued on or after the tenant’s death.
Stay informed of upcoming changes
The bill’s final form is expected by mid-2025 but is still subject to amendments. Keep a close eye on the bill’s progression and any amendments that could impact your responsibilities as a landlord. To prepare for the upcoming changes it would be practical to ensure that houses are in line with the Decent Homes Standard as this will now be extended to cover the private rental sector.
The Renters’ Rights Bill focuses on addressing rogue landlords, giving ethical landlords a competitive advantage in attracting quality tenants. By adapting to these changes and partnering with a trusted agent like Winkworth, landlords can confidently navigate the evolving rental market while safeguarding their investments and ensuring profitability. With a thorough understanding of legislative updates, Winkworth agents provide expert guidance to help landlords remain compliant and avoid potential legal challenges.
