
What is the Renters’ Rights Bill?
The Renters’ Rights Bill is a proposed piece of legislation in the UK being hailed as a game-changer for tenants, promising greater security and higher property standards and aimed at reforming the private rental sector. On 11th September 2024, the United Kingdom’s Renters’ Rights Bill received its first reading in the House of Commons, following on from the Renters Reform Bill 2023, introduced under the previous government, and will, if successfully passed, mean significant changes relevant to the build-to-rent and private-rented sectors.
But for landlords and investors, this reform is a double-edged sword. Many landlords, especially smaller ones, are already navigating rising costs, mortgage pressures, and growing regulatory demands. Adding new layers of compliance, like mandatory Ombudsman membership and the Decent Homes Standard, may feel like yet another burden to bear.
The goal of this bill is to create a rental market that is fair for everyone, improving the quality and stability of rented housing ensuring tenants feel secure and landlords operate within a framework of accountability. Recognising the challenges landlords face in adapting to these new rules is essential. As the legislation takes shape, finding the right balance between protecting tenants and supporting landlords will be key to maintaining a healthy, sustainable rental market.
As your trusted property advisors, Qube Residential expertise will provide a comprehensive breakdown of the key changes introduced by the Labour Renters’ Rights Bill and outline what landlords need to prepare for as the legislation comes into effect.
Why is the Renters’ Rights Bill being introduced?
Labour’s Renters’ Rights Bill is being introduced to address long-standing issues within the rental market, aiming to create a more balanced, secure experience for tenants. The introduction of the Renters’ Rights Bill stems from a growing recognition of the challenges faced by renters in the UK. According to the Renters’ Rights Bill Impact Assessment produced by the Ministry of Housing, Communities and Local Government, the private rented sector has doubled in size in 2002, now representing 19% of all households (4.6 million). Many renters experience substandard housing conditions, unfair eviction practices, and unaffordable rent increases.
With this legislation, the government seeks to address tenant anxieties, providing tenants with protection and stability. The bill is designed to:
- Addresses the imbalance of power between landlords and tenants
- Ensure homes meet basic quality standards
- Provide tenants with greater security and peace of mind
The legislation also reflects wider concerns about housing affordability and the need to adapt the rental sector to meet the demands of a changing housing market. By implementing reforms, the government aims to create a rental market that is both stable and sustainable for all parties.
For landlords, the introduction of this bill raises valid concerns. With the additional layers of regulation, including the mandatory Ombudsman membership and compliance with the Decent Homes Standard, many landlords feel under pressure. It is important that landlords feel educated about the changes so that they can make informed decisions.
How do letting agents and landlords feel about the changes to come?
Letting agents and landlords have had mixed reactions to the Renters’ Rights Bill. While some acknowledge the need for reforms, others are concerned about the potential impacts on their operations and investments.
Many landlords worry about losing control and flexibility, particularly with the abolition of Section 21 evictions. Restrictions on rent increases, limited to once a year with two months’ notice, have also raised concerns about their ability to manage rising costs. Some landlords feel frustrated, fearing they are being “undercut by a minority of criminal landlords” who fail to follow proper regulations.
However, others see potential benefits in the reforms. By establishing a more secure rental environment, the bill could encourage long-term, stable tenancies, reducing tenant turnover and providing landlords with more consistent income. These changes could bring positive outcomes for both landlords and tenants.
Concerns raised:
- Increased regulation – Many landlords worry that the new requirements, such as compliance with the Decent Homes Standard, will involve significant costs and administrative burdens
- Loss of control – The abolition of Section 21 has raised fears about difficulties in regaining possession of properties where necessary, such as for personal use or to sell
- Profitability changes – Rent caps or limits on increased could affect the profitability of rental properties, especially for smaller landlords
Support raised:
- Professionalism of the sector – Some landlords see the reforms as an opportunity to enhance the reputation of the market and encourage long-term tenancies
- Clearer guidelines – A standardised framework could reduce disputes and provide clarity on both sides
Voices from the sector
Dave Seed, Managing Director, Qube Residential, said:
“As the private rental sector faces unprecedented regulations, many landlords are considering exiting the market ahead of the Renters’ Rights Bill set to become law this summer. While tenants have largely welcomed the bill with optimism, landlords are rightly concerned about the implications for property management, particularly in reclaiming their properties for various legitimate reasons. A decline in rental properties could also intensify the housing crisis, leaving more people vulnerable to homelessness or reliant on unregulated landlords, exposing them to greater risks.”
What stage is the Renters’ Rights Bill at?
The Renters’ Rights Bill is currently progressing through Parliament and is expected to become law late 2025. The Renter’s Rights Bill was introduced to the House of Commons on 11th September 2024 and had its second reading on 9th October 2024, where MPs debated its key principles and overall aims.
Many MPs gave examples of the significant challenges faced by tenants renting privately and broadly welcomed the bill’s provisions. There were concerns expressed in relation to the supply of student accommodation, and several MPs called on the government to go further with their reforms by introducing rent controls, preventing landlords from asking for rent in advance and requiring rent guarantors, and compensation for tenants when they are evicted through no fault of their own. Housing Minister, Matthew Pennycook, indicated that he would continue to consider several issues as the bill progressed, in particular: landlord requirements for rent in advance, and the bill’s effect on the student rental market.
Following this stage, it is scheduled to have its third reading on 14 January 2025 to provide an overview of the progress of the bill through the House of Commons prior to the report stage.
Once this process is complete, the bill will progress to the House of Lords for further debate and scrutiny. If the Lords make any amendments, the Bill will return to the House of Commons, engaging in a ‘ping-pong’ process until they reach an agreement.
Once the bill passes through both Houses, it will receive Royal Assent, formally becoming law. The government is expected to implement the changes gradually, allowing landlords, tenants, and letting agents time to understand and adjust to the new regulations. Further updates on specific implementation dates will follow as the bill moves through its legislative journey.
How can landlords make the most out of the Bill?
The Renters’ Rights Bill brings challenges and opportunities for landlords to strengthen their position in the market. One key change is the extension of the Decent Homes Standard, requiring landlords to maintain high property standards. By investing in property upgrades, landlords can ensure compliance, while attracting high-quality tenants and securing higher rents. Well-maintained properties reduce maintenance costs, increase tenant satisfaction, and encourage long-term tenancies, which in turn minimises turnover and vacancies.
The Bill also shifts towards long-term tenancies, providing an opportunity for landlords to establish stable rental income. Embracing periodic tenancies and offering flexible terms can help reduce the costs associated with tenant turnover. Secure, supportive contracts will encourage tenants to stay longer, ensuring a steady cash flow for landlords.
Building strong relationships with tenants is more important than ever. Open communication, responsiveness to maintenance requests, and reasonable handling of tenant requests, like pets, can establish loyalty and improve retention. Happy tenants are more likely to stay long-term, reducing vacancies and turnover costs.
Finally, the Digital Property Portal offers landlords a simple way to demonstrate compliance, register properties, and build a reputation for reliability. By adapting to these changes, landlords can enhance their properties. And secure a stable income. Landlords can still thrive in a more tenant-focused rental market.
What amends have been suggested by the government?
During its legislative journey, several amendments have already been proposed to the Renters’ Rights Bill. One notable amendment (NC3) will address the issue of rent in advance, aiming to improve accessibility to private rented homes and make the rental market more equitable for tenants.
These amendments will strengthen tenant protections and respect landlords’ rights, so the private rental sector remains both fair and functional. As the bill progresses through Parliament, it is likely that further amendments will be introduced to refine and improve its provisions.
When will the Renters’ Rights Bill become law?
The Renters’ Rights Bill is anticipated to become law in 2025. However, the precise timeline may vary, as it depends on the progression of the bill through the legislative process and the time required for parliamentary scrutiny.
What will change:
Abolition of Section 21 “No-Fault” Evictions
Section 21 of the Housing Act 1988 currently allows landlords to evict tenants on two month’s notice, without needing to specify any other ground. The repeal of Section 21 significantly alters the rental market, removing the ability for landlords to evict tenants without providing a valid reason before the property can be reclaimed. Instead, landlords will need to rely on Section 8, which allows eviction under specific circumstances, like rent arrears, property damage, or when the landlord plans to sell or move into the property. While this reform aims to provide greater security for tenants, landlords retain the ability to regain possession when justified. The abolition of Section 21 “no-fault” evictions is a major step in giving renters peace of mind, ensuring they can’t be uprooted without a just cause. Tenants are set to benefit from a fairer, more stable and transparent rental market.
Stronger protection against backdoor eviction
By providing stronger protections against backdoor evictions, tenants are able to appeal excessive above market rents which are designed to force them out. As now, landlords will still be able to increase rents to market price for their properties.
Periodic Tenancies
Under the new rules, all assured shorthold tenancies (ASTs), both new and existing, will automatically transition to periodic tenancies, with tenants able to stay in their home until they decide to end. This means landlords will no longer be able to end a tenancy after its fixed term unless specific legal grounds are met. This change is designed to offer tenants greater flexibility and security. Landlords can still regain possession under legitimate conditions.
Mandatory Landlord Ombudsman Scheme
A new Ombudsman scheme will establish a structured system for resolving disputes between landlords and tenants without resorting to court proceedings providing quick, fair and impartial and binding resolutions for tenants’ complaints about their landlord. Membership in this scheme will be mandatory for all private landlords. This will raise standards and accountability across the sector.
Introduction of a Digital Property Portal
The government is introducing a centralised Digital Property Portal to streamline compliance and transparency in the private rental market. Landlords will register their properties and demonstrate compliance with legal requirements. Tenants will then be able to verify landlord credentials and make sure their new home meets the necessary standards. This portal will improve trust and simplify processes for both parties.
Right to Request Pets
Tenants will gain the legal right to request a pet in their rental property, with landlords required to consider these requests reasonably. If a landlord refuses, they must provide a valid justification. To address concerns about potential damage, tenants may be required to take out pet insurance. This will balance tenant rights with landlord concerns, overall creating a more pet-friendly rental market.
Extension of the Decent Homes Standard
Private rental properties will now be required to meet the same minimum housing standards as social housing under the Decent Homes Standard. This means all rental homes must be safe, warm, and in good condition, creating a better quality of living for tenants. The extension will raise standards across the private rental sector and tackle substandard housing.
Stronger Rent Regulation
To protect tenants from unexpected rent increases, landlords will only be permitted to raise rent once per year. Additionally, tenants must be given at least two months’ notice before any rent increase takes effect. These measures are designed to create stability and transparency for tenants.
Our Expert Advice
Navigating the changes introduced by the Renters’ Rights Bill can be complex, and it’s crucial to get ahead. Utilising professional advice means you’re prepared and compliant. To speak with one of our experts, contact us today:
Telephone
Liverpool: 0151 363 6686
Manchester: 0161 302 8141
Email
Liverpool@quberesidential.com
Manchester@quberesidential.com