Updated: September 2024
New: September 2024 Update on the Renter’s Rights Bill
The Government have published plans to ban no-fault evictions and in-contract rent increases as it prepares to present the Renters’ Rights Bill to Parliament today (11th September 2024).
It heralds one of the biggest changes in the sector in over 30 years.
The Bill, as planned, will abolish Section 21 ‘no-fault’ evictions for new and existing tenancies as well as ending blanket bans for those on benefits or with children. The announcement clarified that the Bill will also extend Awaab’s Law into the private rented sector.
How will this affect landlords?
There are several ways in which the proposed Bill will affect landlords:
- In place of Section 21, landlords will have to rely on Section 8 of the 1998 Housing Act instead in order to evict a tenant. Tenants will still be liable for eviction if they don’t pay their rent, cause damage or engage in antisocial behaviour. Landlords will still be able to take possession if they want to sell the property or move in
- The Bill will also extend Awaab’s Law into the private rented sector, meaning tenants can challenge dangerous conditions
- It will apply the Decent Home Standard for rentals
- The bill expected to allow tenants to end rental agreements with just two months’ notice from the first day they move in
- It will introduce a ban on rental bidding wars, with landlords and letting agents legally required to publish an asking rent for their property
- A ban on in-tenancy rent increases written into contracts so landlords will only be allowed to raise the rent once a year, and to the market rate
- A new PRS database
August 2024 Update on the Renter’s Reform Bill
The Labour government announced plans to reform rental property management in England, with a new Renters (Reform) Bill.
Labour’s version of the Renters (Reform) Bill is a modified version of the Conservative’s Renters Reform Bill that didn’t pass through Parliament before the general election. This new legislation aims to enhance rights and protections for renters.
What was the previous Renter’s Reform Bill?
The Renter’s (Reform) Bill was a piece of legislation proposed by the government to transform the private rental sector and provide more security for tenants. It was introduced by Michael Gove, the former Secretary of State for Levelling Up, Housing and Communities.
Some of the most prominent parts of the bill includes the banning of “no fault” Section 21 evictions, abolishing fixed term tenancies (ending periodic 6, 12 or 24 month contracts) and introducing new registration schemes for landlords.
The bill caused a divided response from MPs, tenants and landlords and was debated through the House of Commons through various stages, with the third reading due to take place at the end of April 2024. However, with the General Election, it emerged on 24th May that the Renters (Reform) Bill would not pass before the 4th July.
What does the Labour Renters (Reform) Bill say?
The new Labour Bill will aim to:
- Abolish Section 21 evictions
- Give tenants the power to challenge unreasonable rent increases
- Introduce a Decent Homes Standard for the private rental sector to reduce poor quality rental homes
- Application of Awaab’s Law, meaning that landlords will have to investigate and fix reported health hazards within specific timeframes
- Create a database that provides essential information for landlords, tenants, and councils, promoting transparency and compliance in the sector
- Make it illegal for landlords to discriminate against tenants receiving benefits or those with children
- A new ombudsman will offer a fair and impartial resolution process for disputes
- Councils will have increased enforcement powers to identify and penalise bad landlords
The Labour Renters (Reform) Bill currently has no timeline, and will likely undergo several reviews before becoming a full Bill.
What should landlords do?
Landlords should make every effort to stay informed about legislative updates and be prepared for new changes to come about.
It’s important to understand your portfolio and ensure your tenancies are complaints. You might even consider speaking with an expert if you are uncertain.
What did each political party say on the Renter’s Reform Bill during the Election?
Labour Party
Labour had previously shared they have doubts over the version of the Renter’s (Reform) Bill as introduced, and instead promised alternative plans. This still includes an end to Section 21 ‘no-fault’ evictions, the right for renters to have pets, to make reasonable alterations to a property, introduce a four-month notice period for landlords – and bring in an end to automatic evictions for rent arrears.
The Labour Party manifesto said:
“Labour will legislate where the Conservatives have failed, overhauling the regulation of the private rented sector. We will immediately abolish Section 21 ‘no fault’ evictions, prevent private renters being exploited and discriminated against, empower them to challenge unreasonable rent increases, and take steps to decisively raise standards, including extending ‘Awaab’s Law’ to the private sector.”
The Labour Party’s stance is clear as they look to ‘overhaul the regulation of the private rented sector’. Even with the dissolving of the bill, Labour still remains committed to abolish Section 21. However, this would likely mean many of the original parts of the Renter’s (Reform) Bill will not pass through the Labour government.
Conservative Party
The Conservative Party Manifesto did include the Renter’s Reform Bill, stating the following:
“We will pass a Renters Reform Bill that will deliver fairness in the rental market for
landlords and renters alike. We will deliver the court reforms necessary to fully abolish Section 21 and strengthen other grounds for landlords to evict private tenants guilty of anti-social behaviour.”
They also pledged to strengthen grounds for landlords to evict private tenants guilty of anti-social behaviour, give more powers to councils to manage the ‘uncontrolled growth’ of holiday lets and introduce a two-year temporary Capital Gains Tax relief for landlords who sell to existing tenants.
Liberal Democrats
The Liberal Democrats promised “to deliver a fair deal for renters” by abolishing Section 21 immediately and reintroducing EPC C targets for rented properties.
The Liberal Democrats manifesto states:
“Liberal Democrats are committed to tackling these housing failures head-on by: [..] Delivering a fair deal for renters by immediately banning no-fault evictions, making three-year tenancies the default, and creating a national register of licensed landlords.”
The party’s manifesto proposed making three-year tenancies the norm and creating a national register of licensed landlords. Their manifesto didn’t specifically address the Renter’s (Reform) Bill specifically, but the main ‘no-fault’ eviction plans remained.
Reform Party
Reform UK planned to abolish the Renter’s (Reform) Bill and instead released their own set of proposed policies to address the housing crisis. The Reform manifesto states the following:
“Abolish the Renters’ (Reform) Bill Existing legislation was inadequate to address bad practices. Instead, we will boost the monitoring, appeals and enforcement process for renters with grievances.”
They also planed to:
“Scrap section 24 for Landlords The tax system should encourage smaller landlords into the rental markets. Not penalise them. We will restore landlords’ rights to deduct finance costs and mortgage interest from tax on rental income.”
Green Party
The Green Party outlined plans for the private rental sector in “Our Fair Deal for Renters”, which covered rent controls, an end to no-fault evictions, and private residential tenancy boards in their manifesto.
In The Green Party manifesto, it stated:
“Elected Greens will push to: [..] – Empower local authorities to introduce rent controls. – End no-fault evictions.“
[..] A new stable rental tenancy and the ending of no-fault evictions: Elected Greens will push to end Section 21 no-fault evictions and introduce longterm leases. Private tenants need to be secure in their homes. Renters will also be given a new right to demand energy efficiency improvements.”
The Green Party has many sustainability measures with a focus on tenant rights. As with the Renter’s (Reform) Bill, the Green Party looks to stable tenancies and abolish ‘no-fault’ evictions, as well as pushing for rent controls to be introduced for local authorities.
To Summarise: Each Party’s Stance on the Renter’s (Reform) Bill and Key Points
- Labour Party: Abolish Section 21 ‘no fault’ evictions. They will look to empower tenants to challenge ‘unreasonable’ rent increases as well as extend health and safety standards to the private sector. They pledge to increase stamp duty on non-UK residents and increase home building with 1.5 million new homes.
- Conservative Party: Abolish Section 21 ‘no fault’ evictions. They pledged to provide two-year temporary Capital Gains Tax relief for landlords who sell to their tenants and also give greater power to local authorities to manage the ‘uncontrolled growth’ of holiday lets. There would be no increase in residential stamp duty and to maintain Private Residence Relief.
- Liberal Democrats: Abolish Section 21 ‘no fault’ evictions. They pledged to enhance tenant security, make three-year tenancies the norm and create a national register of licensed landlords
- Reform UK: Abolish the Renter’s (Reform) Bill. They pledged to encourage smaller landlords into the rental markets and dock stamp duty on properties valued under £750,000.
- Green Party: Abolish Section 21 ‘no fault’ evictions. Introduce greater rent controls and private residential tenancy boards.
