You may be aware that just before Christmas, the Renters Reform Bill was announced during the Queen’s speech. The proposals will have an impact upon both landlords and tenants in England, but the main aim is to create security and longevity in residential tenancy agreements. The summary below highlights the key points you need to know.
What’s the main benefit for Landlords?
The bill would give landlords more rights to gain possession of their property through the courts where there is a legitimate reason to do so, by reforming current legislation including the Section 8 process. The Government has also said it will work to improve the court process for landlords to make it quicker and easier for them to get their property back sooner which can only be seen as positive.
What makes this Bill attractive for tenants?
The details shared so far would improve security for tenants, giving them greater protection and empowering them to hold their landlord to account. One interesting proposal is the introduction of a new lifetime deposit, so tenants don’t need to save for a new deposit every time they move: This idea is specifically aimed at addressing the issue of affordability in the private rental sector: how this will work in practice remains to be seen.
Other key points listed are improving standards in rented accommodation, driving out rogue landlords and helping to professionalise the sector, with all tenants having a right to redress if their rented properties are not safe and healthy. We strongly agree that professionalising letting agents can only be seen as a benefit for both tenants and landlords. There is nothing to fear for good landlords using professional letting agents.
Is Section 21 to be scrapped?
There has also been great discussion around the suggestion of abolishing the use of ‘no fault’ evictions by removing Section 21 of the Housing Act 1988 and reforming the grounds for possession. It’s clear from the above points that the Government are introducing the Renters’ Reform Bill to assist tenants and offer them greater security and living conditions in rented accommodation. Whilst it’s not yet been implemented, it’s clearly only a matter of time until this will affect residential lettings in England.
Contributing factors that have influenced calls for Housing and rental reforms
So why is this reform bill being introduced? The English Housing Survey 2017-18 found that the average length of residence in the private rented sector is 4.1 years. An earlier Government consultation on longer tenancies showed that 79 per cent of tenants had only been offered tenancies of 12 months or less. It seems that the Government would therefore like to encourage longer tenancies to increase security for tenants.
According to the English Housing Survey, around three quarters of private renters paid a deposit at the start of their current tenancy. The Tenant Fees Act, which came into force in June 2019, capped deposits to 5 weeks’ rent where the annual rent is under ￡50,000 per year. If all tenants have to pay a deposit this offers better protection for landlords and also tenants feel more responsible and treat properties with greater respect.
It’s clear these proposed changes would have a great impact but there are a number of hurdles that need to be addressed and overcome before this bill becomes law. The consultation process is ongoing and many Landlord industry bodies are lobbying the government and involved in discussions, so we are hopeful that the detail, when it comes, is sensible.
The full proposal for the Renters Reform Bill can be found on the Government website and you can rest assured, we’ll bring you updates as soon as we have more news to share.
Crystal joined Pace in 2007 and was appointed to her current role of Managing Director in 2010, heading up the company founded by her father in 1994.
She is responsible for the daily operations of the business, whilst also ensuring the company is financially sound, has strategic direction and is planning for future growth.
Crystal takes a thoughtful and considered approach to all that she does, transferring her determination to deliver implicit care, attention and professionalism to every member of her team.
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