Robert Pearson
An overhaul of legislation surrounding the private renting sector has been mooted for some time since the idea was first raised in 2019. Robert Pearson, a Partner in our Commercial Litigation Department, previously wrote about the proposed changes when they were first suggested. (This can be read here).
Since then, there has been various delays. After the COVID-19 pandemic, the Renters (Reform) Bill 2023 was eventually introduced to Parliament in May 2023. The Bill made its way through the House of Commons and was on its second reading within the House of Lords before the July 2024 general election drew matters to a halt.
The Renters' Rights Bill 2024 has now been published. Although the two Bills may appear similar at first glance, there are some key differences which should be noted by both landlords and tenants.
Section 21 Notices
Whereas the old Bill proposed to hold off on abolishing the practice of serving section 21 notices until the Courts were in a better position to cope with the anticipated influx of work, the new Renters' Rights Bill 2024 promises to abolish Section 21 notices as soon as the Bill is passed into law. Abolishing Section 21 notices will likely result in an increase in Section 8 notices which in turn will create more pressure on the Court system.
'Awwab's Law'
Another key difference between the previous Renters (Reform) Bill 2023 and the new Bill is the inclusion of 'Awwabs Law' into the private rented sector. Although both Bills planned to apply the Decent Homes Standard to the private rented sector, the Renters' Rights Bill 2024 goes one step further by also proposing to apply 'Awwab's Law' within the sector. Awwab's Law ensures that landlords fix health hazards reported to them within specified timescales.
Restrictions in relation to costs
Under the new Bill there are proposed provisions to prevent landlords from asking for and accepting offers which are above the rent advertised for the property. The Bill would make it illegal to accept such offers which in return should reduce rental bidding. These provisions were not included within the previous Bill.
Increased notice periods
Another noticeable difference within the Renters' Rights Bill 2024 is the duration of the notice periods within the reformed grounds for possession. For example, under the 2023 Bill the notice period for possession where a landlord or their family member wished to move into the property was proposed as 2 months, whereas under the 2024 Bill the proposal is a 4-month notice period, as is also the case for many other grounds within the new 2024 Bill.
Other proposals within the Renters' Rights Bill 2024
Additional proposals within Renters' Rights Bill 2024 include:
- Introduction of a new Landlord Ombudsman for the private rented sector;
- The provision of stronger protection from so-called "backdoor evictions" whereby tenants will be able to appeal against increases in rent;
- The creation of a private renter property database where landlords will be legally required to register themselves and their property if they are the landlord of an assured or regulated tenancy. The database will also aim to provide landlords with guidance as to their responsibilities;
- Providing tenants with more rights in relation to pets;
- Making it illegal for landlords and agents to discriminate against prospective tenants who are in receipt of benefits or have children;
- Strengthening rent repayment orders by extending them to superior landlords and company directors; and
- Strengthening local authority enforcement by providing them with new investigatory powers.
It will be interesting to see what changes within the Bill, if any, are proposed during its progression through Parliament. We will also have to wait to see if any proposals are made with regard to speeding up the progress of possession cases through the Court system.
The abolition of Section 21 notices in particular will be a hugely significant change for landlords and tenants in the private rented sector, and this is likely to have a knock-on effect of increasing the number of Section 8 notices. As the Accelerated Possession Procedure cannot currently be used where a Section 8 Notice has been served, this will in turn increase the workload for the Court system, which is already struggling to cope. In the short term, we are likely to see an increase in Section 21 notices before any abolition comes into force. It is very important that landlords seek legal advice to ensure that any notices served are valid. If an invalid notice is served, it often means that the landlord will need to re-start the entire process and can mean that the landlord is liable to pay a significant costs Order made in favour of the tenant.
If you are a landlord seeking possession of a residential property or would like further information about the new system, our Commercial Litigation & Dispute Resolution team can help advise you of your options.
Photo by Bethany Opler on Unsplash.