Will the Renters’ Reform Bill affect me as a landlord?

What is the Renters’ Reform Bill?

On 11th September 2024, the Labour government announced that they would be looking to make changes within the private rented sector through the Renters’ Reform Bill (or the Renters’ Rights Bill). The proposed changes aim to strengthen tenant protections, improve housing quality, and rebalance the rights of landlords and tenants.

Key changes landlords should know about

• Abolishing section 21 ‘no fault’ evictions

Landlords will no longer have the option to evict tenants via a Section 21 without stating a reason. Instead, landlords must rely on specific grounds for possession.

• Longer notice periods for possession

The Bill will mean that landlords must give tenants longer notice periods when seeking possession. For example, if a landlords circumstances have changed, for example they want to sell the property, they need to provide 4 months’ notice – double the current 2 months.

• End fixed-term and assured shorthold tenancies

The Bill will be introducing periodic tenancies. Landlords will no longer be able to offer a fixed term or assured shorthold tenancy. The periodic tenancy will allow tenants to terminate their tenancy at any point by providing 2 months’ notice to the landlord.

• Introduction of Decent Home Standards

Tenants will now have safer and better value homes. This standard aims to remove poor quality housing in the private rented sector. Failure to comply may lead to local authority enforcement, including improvement notices.

• Ban on rental bidding

Landlords will no longer be able to accept offers of rent that are more than the advertised rental price for their property, preventing bidding wars.

• Reduced ban on re-letting

Previously, if a landlord evicted a tenant on the basis that they were selling the property and then the sale became abortive, the landlord would be unable to re-let their property for a period of 12 months. Under the Bill, this will now be reduced to 6 months.

How will eviction procedures change?

Due to the abolishment of Section 21 Notices, the eviction procedure for landlords will significantly change.

Similarly to the current process for evicting a tenant based on rent arrears, landlords will now be required to rely on specific grounds for possession, such as rent arrears or disrepair at the property.

For landlords that are seeking eviction based on rent arrears, the tenant will now have to be in 3 months’ worth of arrears before a notice can be issued. Additionally, the notice period for rent arrear evictions will increase from 2 weeks to 4 weeks.

These changes are likely to mean that landlords will incur further costs and experience delays in gaining possession under the new Bill.

What are my responsibilities as a landlord under the Decent Homes Standard?

The introduction of Decent Homes Standard means that landlords will be responsible for ensuring their properties meet minimum health and safety and maintenance standards. This will no doubt increase costs for landlords.

Failure to comply with the standard could result in the local council taking enforcement actions which will vary depending on the nature of the matter. For more serious cases, the council may issue landlords with a home improvement notice which is a requirement for the landlord to rectify the issues within a specific time frame.

Am I still allowed to increase the rent?

The Bill aims to remove any unreasonable rent increases and landlords demanding large sums of money from tenants.

Under the new legislation, landlords will be able to increase rent once a year at the market rate. This means that the rent will increase to the market rate as if the landlord were putting the property on the market as a newly advertised property to rent.

If a landlord wishes to increase the rent, they will need to serve a Section 13 Notice and provide the tenants with at least 2 months’ notice before the rent increase is implemented.

Tenants do also have the right to dispute the proposed increase if they believe it exceeds fair market value.

Need Legal Advice About the Renters’ Reform Bill?

The Renters’ Reform Bill will make significant changes that could affect rental income, property management, and the ability to regain possession. Early preparation and legal guidance can help landlords adapt to the new legal landscape and avoid costly mistakes.

The Bill will introduce a wide expanse of changes for landlords, of which this article does not cover all of them. Therefore, it’s important to ensure that you are fully informed of all the changes and that you seek further advice and guidance on this matter.

At Hegarty, we specialise in landlord and tenant law. Whether you need tailored advice on eviction procedures, compliance with the Decent Homes Standard, or guidance on tenancy agreements, we’re here to help.

Contact our team today for expert landlord legal advice that you can rely on.