Understanding the Renters’ Rights Bill: A Guide for Landlords and Property Professionals
The Renters’ Rights Bill is set to bring significant changes to the private rented sector in England. It impacts landlords, tenants, and property professionals, shaping the way rental agreements work and how properties are managed. With an emphasis on fairness and security, these reforms aim to balance the rights of tenants and the responsibilities of landlords, while offering opportunities for property professionals to adapt and thrive.
Key Takeaways:
What’s Included in the Renters’ Rights Bill?
The Renters’ Rights Bill outlines several key changes that landlords should be aware of, including:
1. Abolition of Section 21
Landlords will no longer be able to issue Section 21 notices to end tenancies without a specific reason. Instead, possession notices will rely on Section 8 grounds, which require clear justification, such as non-payment of rent or property damage. The abolition of Section 21 is designed to offer tenants greater security but also means landlords must be more diligent in ensuring valid grounds for eviction.
For Estate Agents: Estate agents will need to keep up to date with the new eviction processes and assist landlords in ensuring they follow the correct procedures under Section 8.
2. Periodic Tenancies
All tenancies will be converted to periodic tenancies, meaning there will no longer be a fixed-term tenancy. Landlords will need to adapt to this new arrangement and consider the implications for rental income and property turnover. There will also be no minimum tenancy term, but tenants must give two months’ notice before leaving.
From a Renters’ Perspective: This change offers greater flexibility for tenants but also means landlords need to adjust their expectations around tenancy durations and the potential for frequent turnover.
3. Rent Increases and Limits
Rent increases will be capped to once per year and must be in line with market rates. Additionally, landlords will need to follow a formal process for rent hikes under Section 13, providing at least two months' notice. Tenants will also have the right to challenge rent increases via the First-tier Tribunal if they feel it is unfair.
For Landlords: It’s crucial to review rental pricing strategies regularly to ensure they align with the market while complying with these new guidelines.
4. Pet-Friendly Renting
Landlords will be required to consider pet requests from tenants and can only refuse based on valid reasons, such as damage concerns or restrictions imposed by the property owner. The bill updates the Tenant Fee Act to allow landlords to request pet insurance as a precautionary measure for potential damage.
For Estate Agents: Helping landlords navigate the new rules on pets will be essential, especially in attracting responsible pet owners while protecting the property.
5. Ban on Rental Bidding
Landlords and agents will no longer be able to encourage prospective tenants to offer a higher rent. This helps eliminate rent bidding wars and ensures that tenants are not unfairly pressured into paying more than the listed rent price.
For Estate Agents: Estate agents will need to ensure they are adhering to these rules when marketing properties and managing tenant negotiations.
6. Cap on Rent in Advance
Landlords will no longer be able to require tenants to pay multiple months’ rent upfront as a condition of renting a property, offering more affordable access to housing for tenants. However, landlords can still request a deposit and advance rent as per usual practices.
Changes in Notice Periods and Grounds for Eviction
The Section 8 notices will also be amended to include specific grounds for eviction, such as when landlords wish to sell their property or when family members need to move in. There are also new provisions for student accommodation and adjustments to the grounds for evictions related to rent arrears.
For Renters: These changes aim to provide greater stability and security, ensuring tenants aren’t evicted without reason or sufficient notice.
What Does This Mean for Landlords and Property Professionals?
For landlords, the Renters’ Rights Bill means staying informed about changing regulations and being prepared to adjust property management practices accordingly. Key areas like rent increases, tenancy terms, and the reasons for eviction will require closer attention and clearer communication with tenants.
For Estate Agents: This legislation presents an opportunity to demonstrate your expertise and support landlords through these transitions. By offering guidance on compliance and proactive management strategies, you can foster stronger relationships with clients and attract new business.
Looking Ahead: How can JSTEAD help?
We’ll guide you through the changes and handle the hard work for you.
At JSTEAD, we will ensure our landlords and estate agent partners are ready for the switch to periodic tenancies.
We’re also offering consultations to help landlords avoid rent arrears and long eviction processes.
We’re working closely with government departments, peers, Lords, associations, and industry experts to better understand the Bill and suggest sensible changes.
Many of our new tenancies are non-ASTs, thanks to strong relationships with estate agents and landlords who trust us to provide corporate tenants, so most of the above won’t apply.
If you choose to have your property managed by JSTEAD, you will have an expert responding to any property-related issues and access to our panel of approved, reliable contractors. This is why, as a client of JSTEAD, you can rest assured that your investment is in very capable hands.
If you're a tenant, you can be in the knowledge that your tenancy will remain compliant and are renting a home that meets all of the industry standards.
