Renters’ Rights Bill to send ‘shockwaves’ through the sector
Yesterday Labour introduced the bill into parliament in a bid to abolish no-fault evictions. However, the response from industry experts has been mixed to say the least.
In a nutshell the Bill’s main purpose is to ban section 21 evictions – which don’t require landlords to find any fault with their tenant, but are sometimes used to retaliate when tenants raise complaints.
However, under the new legislation, tenants will still be liable for eviction if they don’t pay their rent, cause damage to the property, engage in antisocial behaviour and landlords are still allowed to take possession of the property if they want to sell it or move into it themselves.
The new laws, which only cover England, will also:
- Only allow landlords to raise rents once a year and only to the ‘market rate’.
- Fine landlords up to £7000 if houses don’t meet a ‘decent homes standard’.
- Set deadlines for landlords to tackle dangerous conditions in an extension to the private rented sector of Awaab’s Law.
- Abolish blanket bans on renting to people with children, have pets or who are receiving benefits.
If the Renters’ Rights Bill comes into power in Spring 2025, like ministers are hoping, the rules could come into effect as quickly as the summer.
Below are a number of responses that have come from the housing industry since the bill was announced yesterday, Wednesday 11th September.
Scott Goldstein, partner and property disputes specialist at Payne Hicks Beach
‘The elephant in the room is the lack of any reform of the court system, which will surely become (even more?) unfit for purpose once judges have to deal with the increased caseload resulting from an increase in possession cases.
‘Another, perhaps less appreciated, point is the impact on local authorities of the significant increase in their regulatory burden stemming from this legislation. Any legal system is only as good as the smooth functioning of its enforcement mechanisms.’
Sam Reynolds, CEO of Zero Deposit
‘Labour’s decision to force through the ban on Section 21 evictions seems a tad knee-jerk at best and it’s clear that they are looking to get renters onside without considering the serious long-term implications this could have on the wider rental market.
‘Yes, improving standards is a goal we should all be working towards, but we need to have the proper processes in place in order to make a meaningful change that won’t come at the further detriment of tenants.
‘[The] decision is likely to deter more landlords from the sector, a migration that has already intensified under the new Labour government’s short tenure, further reducing the levels of quality accommodation available to tenants and driving rents ever higher in the process.’
Oli Sherlock, managing director of insurance at Goodlord
‘The stuttering, broken-record loop the industry has been stuck in over this legislation may finally be coming to an end. It won’t necessarily all be music to the sector’s ears, but we will at least have some clarity.
‘The biggest change between the previous Renters (Reform) Bill and the new Renters Rights Bill will be around Section 21. The Conservative government offered the industry something of a fudge around the scrapping of no-fault evictions, with vague promises to introduce it once the courts were ‘ready’. Whilst we agreed with the sentiment of this, there was no timeline or action plan announced alongside. In contrast, it looks like the Labour government will scrap S21 outright and the courts will need to find a way to cope.’
Lauren Hughes, head of customer success at Vouch
‘At first glance, this Bill will look very similar to the previous legislation, but once you scratch the surface critical differences will emerge. Labour has already indicated that they will go further around rent increases – including ending bidding wars and challenging unfair rent increases.
‘However, in a way that has become familiar over the years, we have thus far been given little detail about how they will achieve this. Likewise, the government has decided to take the standard of private housing further by integrating the Decent Homes Standards and Awaab’s Law. And, most crucially, it appears that S21 will be scrapped as soon as the Bill passes into law. It’s a seismic piece of legislation. The industry will cope with the changes – it always does – but that doesn’t mean it will be a smooth or painless transition.’
Image: tommao wang
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