The Renters’ Rights Bill was published on 11 September 2024 and has already had its first reading in Parliament. The Bill is now set to progress to its second reading, likely after the party conference season in October. The Government aims for quick progress, with the Bill potentially becoming law by mid-2025. The timeline for the Bill’s passage depends on parliamentary scheduling, but it has been designated as a priority due to its inclusion in the Labour Party’s 2024 election manifesto.
The Bill proposes comprehensive reforms and introduces several significant differences compared to the Renters (Reform) Bill, which was introduced on 17 May 2023. Below are the crucial elements of the Bill that landlords must be aware of:
End of Section 21 “No-Fault” Evictions
One of the biggest changes is the complete abolition of Section 21 evictions. Landlords will no longer be able to evict tenants without providing a reason. Instead, assured shorthold tenancies will automatically convert to periodic tenancies.
Currently, there are no transitional provisions for existing fixed-term tenancies, meaning all ASTs, including periodic ones, will automatically convert on a single date to be set by regulations. This provides tenants with more flexibility and security. Tenants will be able to leave with two months’ notice, while landlords will need to follow the new and reformed grounds for possession.
New Grounds for Possession
The Bill introduces grounds for possession, such as the sale of the property or a landlord/family member moving in. However, these cannot be used within the first 12 months of the tenancy, and a 4-month notice period will apply. Restrictions will also prevent re-letting or re-marketing the property for 12 months following the service of a possession notice on these grounds. Non-compliance could result in penalties of up to £7,000.
Changes to Rent Arrears Grounds
The previously proposed Ground 8A (mandatory eviction for rent arrears) has been removed. Ground 8, which deals with rent arrears, has been amended to require 3 months’ arrears (increased from 2 months) for landlords to seek possession, with a 4-week notice period.
Special Provisions for Student Tenancies
Purpose-built student accommodation is exempt from the provisions of the Renters’ Rights Bill. Universities’ own accommodation and joint student tenancies in HMOs remain under the current framework, though landlords must still consider nuances around managing joint tenancies and guaranteeing rent liabilities.
Civil Penalties for Illegal Evictions
Local authorities will now have the power to issue civil penalties of up to £40,000 for illegal evictions under the Protection from Eviction Act 1977. This allows for quicker enforcement without the need for a full criminal prosecution.
Other Important Reforms
- Banning rent bidding: The Bill introduces a prohibition on landlords asking for or accepting offers above the advertised rent price.
- Application of Awaab’s Law: Clear legal expectations for addressing serious hazards in private rental properties will be set, applying Awaab’s Law (previously applied to the social sector) to private rentals.
- Decent Homes Standard: This will now apply to the private rented sector, ensuring all rental homes are safe, secure, and hazard-free.
Brecher will keep you updated on all relevant and upcoming changes in relation to Renters’ Rights Bill.
This update is for general purpose and guidance only and does not constitute legal advice. Specific legal advice should be taken before acting on any of the topics covered. No part of this update may be used, reproduced, stored or transmitted in any form, or by any means without the prior permission of Brecher LLP.
