In the week that we were all poised for the publication of the Renters’ Reform Bill, set to be the biggest shake up of the PRS, in over three decades, we heard, yesterday, that it was being postponed due to “procedural issues.”
This leaves us all waiting in limbo, with little detail on time frames. What we do have, however, is the Government’s White Paper, which was published in June of last year (2022), so let’s have a look at the major points here.
There are 10 major points in the paper, let’s have a look at them now:
- Periodic tenancies. The proposal here is to convert Assured and Assured Shorthold Tenancies to a single structure, where tenants can terminate a tenancy with 2 months’ notice and Landlords with a “legitimate reason.” As there will be a complete overhaul of Section 8, these “legitimate reasons” are subject to change and addition.
- Abolition of the so called “no fault eviction” Section 21. With the introduction of new possession grounds for Landlords and a complete overhaul of Section 8. The wording here is worth noting: “We will reform grounds of possession so that they are comprehensive, fair, and efficient, striking a balance between protecting tenants’ security and landlords’ right to manage their property.
- Create a new Private Renters’ Ombudsman to settle disputes informally.
- Extend the Decent Homes Standard to the sector (to include a review of the HHSRS, due to conclude in Autumn 2022)
- The Introduction of a new Property Portal to support Landlords (with compliance, regulations etc.) and to provide information on rogue landlords.
- Abolition of Rent Review Clauses in contracts (where tenants are locked into automatic increases). “Rent adjustments should be predictable and allow time for tenants to consider their options…once a year…notice of increase to be 2 months.” Gratifying to hear was the statement that “…this Government does not support the introduction of rent controls…” As this was something causing concern for many landlords, especially those in Bristol, following the recent (March 2022) Renters’ Summit, where there were wholescale calls for rent controls and a flat rate across the city.
- Outlaw blanket bans on renting to families with children or tenants on benefits, by landlords and agents, with restrictions like “No DSS”, “No Benefits” or “Working professionals Only.” Making it illegal for landlords or agents to have blanket bans on renting to families with children or those in receipt of benefits.
- Incentivise landlords to accept tenants with pets, by making it easier for landlords to accept pets by amending the Tenant Fees Act 2019, to include pet insurance as a permitted payment. Landlords should not “unreasonably withhold consent…tenants to be able to challenge a decision.”
- Reform and speed up the court process. Looking at “…areas that frustrate and hold up possession proceedings…” (bailiffs, paper-based proceedings, prioritization).
- Passporting Deposits to bridge the period where deposit requirements overlap, with “market led solutions…,” like loan and insurance products.
So, what happens next?
Passing a bill into law in the UK is a process that can take several months. It involves several stages of scrutiny and debate in both the House of Commons and the House of Lords
- First, the bill is published and introduced in the House of Commons for its first reading. Then, MPs debate the main principles of the bill in the second reading, followed by a committee stage where a group of MPs scrutinizes the bill line by line and proposes amendments.
- During the committee stage, written and oral evidence is also called for from groups such as the National Residential Landlords Association. The NRLA have been the voice of common sense and great champions for both landlords and tenants alike. The NRLA produced its own document in response to the bill, “A New Deal for the Private Rented Sector” outlining changes which would make a real difference and impact some of the more problematic aspects of the Government’s proposals. This evidence focuses on suggested amendments and improvements needed for the bill.
- The report stage then follows, where all MPs have the opportunity to table, debate, and vote upon further suggested amendments and new clauses to the bill. Finally, the third reading is the last chance for the Commons to debate the contents of the bill before it moves on to the House of Lords
- A similar process then takes place in the House of Lords, and any amendments must be agreed upon by both Houses before the bill is sent to the monarch for Royal Assent. Once Royal Assent is given, the bill officially becomes an Act of Parliament and becomes law.
Rest assured that we have our eyes on this one, eagerly, and will report back with news and updates as they occur!
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