The new Renters’ Rights Bill was published by the Government last week. In the 200 pages are the details of the road that the Government intends to go down with the Private Rental Sector (PRS). It contains many of the same things as its predecessor the Renters (Reform) Bill, which was introduced by the last government with the introduction of 80 additional clauses which in most respects takes the bill back to what it looked like in 2019.

It is predicted by the Housing Minister Matthew Pennycook that it will pass by spring next year and become law soon afterwards.

A ban on Section 21 ‘no fault’ evictions has grabbed the headlines, but there are many other measures in the bill that will affect landlords, tenants and agents. From Government statistics, there are 2.3 million landlords in England and approximately 11 million renters. As there are quite a few measures that are mentioned in the new Bill I will be looking at the most important clauses in detail over the next few weeks. This will include:

• Removal of ‘no fault’ Section 21 notices for all tenancies
• A new mandatory Ombudsman for all landlords
• A mandatory private rental sector database of landlords
• Strict controls on rent bidding and offers during marketing a property for a tenant
• Removal of fixed term tenancies, creating rolling tenancies from the outset
• A 12-month protected tenancy period for tenants
• A ban from discriminating against tenants on benefits, or with children
• Tenants given strengthened rights for having a pet in a rented property
• Strict controls on rent reviews and a ban on in-tenancy rent review clauses
• Stricter possession grounds for landlords, with longer notice periods
• A new possession ground for landlords renting to students
• The Decent Homes Standard to be applied to the private rental sector
• The application of ‘Awaab’s Law’ to the private rental sector, setting timeframes for a property to be remedied of any health risks
• Strengthening of local authority enforcement powers and expanding civil penalties
• An expansion of Rent Repayment Orders

The Removal of Section 21

This is the so-called ‘no fault eviction’. (Section 21 notices served before the commencement date of the law will continue to be valid until they expire).

The media is using this as click bait and giving the impression that a landlord will never be able to end a tenancy – utter rubbish. It will certainly be different but there will always be a means of ending a tenancy. The reason that the Section 21 notice is used at the first line of ending a tenancy is that it was set up as a mandatory notice in the 1988 Housing Act. Meaning that as long as the paper work was in order and the tenant did not move out after the two months’ notice: once it got to judge’s chambers (i.e a barrister was not involved) the judge had to give possession.

Over the last two years our figures show it is taking on average about five months* from the issue of a Section 21 to the tenant leaving the property and about nine
months* if you have to go to the bailiff stage. The alternative way of ending a tenancy has been by using a Section 8 notice which if the tenant did not leave after two weeks the noticed needed to be decided at court (a barrister was involved. Under this section the judge had a choice to give possession or not. Section 8 has been mainly used to end a tenancy over non-payment of rental. It has always had the jeopardy that if the tenant makes sure they are less than two months overdue you must wait for a new court date.

One concern will be that ending a tenancy under the new regime may take longer in the future, but this can be countered by making sure that you have legal expense and rent protection insurance. The thinking behind the change is to stop rogue landlords giving notice if a tenant complains about the condition of a house. So, let’s look at some figures from our data.

• During the pandemic notice period went to six months and the rental market did not implode.
• Section 21 was abolished in Scotland in 2017 – there is still a thriving rental market in Scotland.
• Other factor to remember is that 87% of tenancies are bought to an end by the tenant. The remaining 13% can be broken down as follows:
  • 7% due to wanting the property back to move into – mainly overseas landlords
  • 3% due to needing/ wanting to sell
  • 2% due to late payments
  • 1% due to negligence of the tenant

What we understand at the moment

• The Section 8 notice will be strengthened to include mandatory notices for:
  • The landlord wanting to move back into the property
  • To sell the property
  • Unsocial behaviour by the tenant

Landlords won’t be able to use these grounds in the first 12 months of a tenancy, will need to give four months’ notice, and can’t market the property for 12 months after the notice expires or the claim is filed at court.

Matthew Pennycook says the Government will invest in extra court capacity to ease logjams before Section 21 ‘no fault’ evictions are banned. His exact words were the Government “will invest in additional court and tribunal capacity to handle any extra hearings generated by these reforms”. A new digital system for possession claims is also being developed ‘making the process quicker, clearer, and more reliable for landlords and tenants alike’.

Next week I shall be covering more aspects of the new Bill . If however you have any concerns now that you would like to talk through just click here to book an appointment.