A new white paper has been released that covers a number of suggested improvements and measures that could transform the rental world for the better. The ‘Fairer Private Rented Sector’ white paper was published on the 16th of June 2022, detailing some big changes for the rental sector that are set to improve and enhance the relationships between tenants and landlords as a result. We’ve taken a look at what the white paper has laid out and what this bill could mean for the rental sector.
What Is The New Renters Reform Bill?
The Renters Reform Bill is a bill set to be discussed in parliament following its introduction in the government’s Fairer Private Rented Sector white paper. This paper is a written summary of their commitment to “delivering a fairer, more secure, and higher quality Private Rented Sector”, completely shaking up the way that the rental sector currently operates. However, this reform bill isn’t a new idea – it was originally proposed in the Levelling Up white paper, where plans were introduced to “reset the relationship between landlords and tenants”, with a focus on “ending the unfair situation where renters can be kicked out of their homes for no reason”.
The Renters Reform Bill covers a variety of different issues and measures that could and should be taken, including abolishing Section 21 notices and evictions. Major changes could be seen to a landlord’s approach to tenants on benefits, pet requests, rent increases and the standard at which landlords need to maintain a property. The white paper and the resulting bill aim to protect tenants, particularly those who are the most vulnerable, with new measures to tackle unfair practices and provide improved support for those with the cost of living pressures.
What Measures Does the Renters Reform Bill Cover?
While the exact final details of the Renters Reform Bill will be discussed in parliament and scrutinised before becoming final, the white paper has given us an in-depth insight into what the bill can and should cover in order to protect both renters and landlords. Measures covered include:
Section 21
The biggest and perhaps most transformative change that the Renters Reform Bill is set to implement is the abolishment of Section 21 evictions. Historically, Section 21 has been used to evict tenants without a reason or cause, effectively creating an unfair and imbalanced rental situation. No tenant was secure in their property, even if they were living without any fault, danger or rule-breaking. The bill is set to remove ‘no fault’ Section 21 evictions in order to provide ‘greater security for tenants while retaining the important flexibility that privately rented accommodation offers’. In order to do this, a new single system of periodic tenancies will be introduced, in which tenants will need to provide two months’ notice when leaving a tenancy, and landlords will only be able to evict a tenant in reasonable circumstances.
New Decent Homes Standard
The Decent Homes Standard is a standard already in place for the Social Rented Sector but is now due to be extended to include Privately Rented properties too. Under these standards, private rented properties must have:
- No serious health and safety hazards e.g. risks of fall, fire or carbon monoxide poisoning
- Adequate kitchen facilities
- Adequate bathroom facilities
- Decent noise insulation
- Clean, appropriate and usable facilities
- Adequate heating
Possession and Eviction
The reform bill is also set to improve the grounds for possession in order to make them more comprehensive, fair and efficient. The government is introducing new mandatory grounds for eviction for any landlords that want to sell their property and want to move themselves or their family into the property. It cannot be done for the first six months of the tenancy.
The bill will also help to strengthen a landlord’s grounds for repossession of the property in cases where tenants are willfully not paying their rent or arrears, or who are repeatedly engaging in anti-social behaviour.
Outlawing Blanket Bans On Benefits
Landlords will no longer be able to place blanket bans on tenants receiving benefits or on families with children. The days of “No DSS” or “No Benefits” policies will be behind us, with this new reform outlining these policies as being “unlawful discrimination”. These bans were described by courts as being against the Equality Act and discriminatory against vulnerable people, women and the disabled, ultimately making the rental process far more difficult for people within these groups. The reform bill states that the government will:
- Support landlords in making informed decisions on each individual’s situation rather than via a blanket ban
- Investigating improvements to welfare support for both tenants and landlords, including those who struggle to manage their rent payments via Universal Credit etc.
- Working with insurance businesses to handle the misconception that insurance is harder to obtain for landlords and properties with tenants receiving benefits
- Boosting awareness of local services available to help those on lower wages or benefits.
The Right To Pets
If there’s one longstanding argument between landlords and tenants that everyone seems to hold an opinion on, it’s whether or not landlords should have the right to ban pets in their properties. The Renters Reform Bill is set to put this argument to bed for good – it is set to make it easier for tenants to have pets in their homes by giving all tenants the right to request a pet in their homes. Landlords must consider these requests and cannot refuse on unreasonable grounds. While the exact details of this are still set to be discussed and hashed out, it is suggested that Landlords will have the right to set out requirements for pet insurance to cover any damage to their property caused by pets.
A New Mandatory Ombudsman
A single government-approved ombudsman is set to be introduced that will cover all private landlords that rent out properties in England, ultimately allowing private tenants and landlords to settle disputes outside of court. It is set to be more cost-effective for all involved and will provide impartial and fair resolutions to many common issues that may otherwise not need to make it to court. It is expected to be a more streamlined process and also offers education, feedback and support for vulnerable tenants and landlords. Membership will be mandatory for landlords, ensuring that tenants can put across complaints to the Ombudsman with the knowledge and reassurance that the complaint can be handled fairly.
Rent Increases and Rent in Advance
The bill is set to end the use of rent review clauses, with landlords now only able to increase rents once per year with at least two months’ notice of any rent changes. These changes are designed to prevent tenants from being locked into automatic rent increases, particularly those that are vague or given at the last minute. Similarly, if tenants pay their rent multiple months in advance, landlords are required to repay any upfront rent if a tenancy is set to end earlier than the period paid for. Limits will also be placed on how many months’ rent can be asked for in advance.
New Property Portal
A new property portal is due to be released which will offer a central system from which landlords, tenants and even local councils can access the information they need about a property. For tenants, they can access information about landlords’ compliance with their responsibilities, as well as any information about criminal landlords and other offences that should be publicly visible. This also puts additional pressure and accountability on landlords to maintain a property and keep up with their responsibilities but also puts additional pressure on the need for Landlord’s Insurance policies and other protections in the event of claims or misinformation.
The exact details of this bill could change substantially over the course of the parliamentary discussion of its points, but these new measures should help to improve the private rental sector as a whole for landlords and tenants. As a landlord, making sure you have the right insurance in place and that you are following your requirements effectively will help you to keep up with these changes and ensure you and your tenants are both treated fairly throughout the tenancy.