The Renters Reform bill will take some time to be implemented but it is useful to have a basic understanding of what is proposed. There may be changes to the bill before it becomes law.
Implementation of these new laws is expected to come in two stages
Stage 1 – all new tenancies become periodic and governed by the new rules. At least six months’ notice will be given of this date. It will depend on how long the legislation takes to pass through Parliament and when the court system is ready to implement the changes. October 2024 is being muted for this.
Stage 2 – all existing tenancies are to be subject to the new rules. It is expected that there will be at least 12 months between the first and second date.
So what is changing under the proposed new Section 8 grounds?
Section 21 No-Fault Evictions to be Abolished and New Grounds Created
There will no longer be Assured Shorthold tenancies. The plan is for Section 21 Notices to be abolished.
No more fixed terms – only rolling tenancies
Most ASTs are currently for 6 or 12 months with a new fixed term agreed at the end of the term OR evolving into a periodic or rolling tenancy.
The new bill proposes that all rental properties will be periodic. The aim of this is to enable tenants to leave an unfit property prior to the end of a fixed term or if their circumstances change. There is a 2-month notice period proposed.
New Grounds will be introduced under section 8.
As in the current system – all grounds will need to be “proved” by the Landlord. The Eviction Process will remain the same with a notice being served and followed up via court proceedings.
In most cases, Landlords want a rent-paying, long-term tenant who looks after their property and only wants to evict a tenant if there are problems. The hope is that in those circumstances, Landlords will be better off than they are currently in the cumbersome Section 8 court system. The Bill introduces and amends a number of the current existing grounds under section 8 of the Housing Act. A positive change to the Section 8 grounds will be that Landlords will be able to evict tenants to sell or move a family member into the property. These are expected to be mandatory grounds and will require 2 months’ notice.
The obvious right to evict a tenant for rent arrears remains. If a tenant is in arrears for more than 2 months, 4 weeks’ notice will be required. This remains a mandatory ground. A new mandatory ground is proposed for tenants with three instances of being at least 2 months in arrears in a 3-year period. The Bill also proposes other arrears-related discretionary grounds for persistent late payment and any level of arrears thus strengthening a landlord’ powers where a tenant’s payments are erratic and behind.
Will this ground help reduce last-minute payments being made to prevent eviction and tenants playing the rent arrears “game”?
Discretionary grounds will remain for breach of tenancy and deterioration of the property so if a tenant refuses access or damages the property these grounds will continue to be used.
Rent Increases
A new system is being produced in relation to rent increases with a new notice. This is being proposed in order to prevent Landlords from increasing rents with the purpose of forcing tenants to leave. Tenants will be asked to accept or dispute the rent review. If disputed it will be referred to the First Tier Property Tribunal. Rent increases will be limited to the current open market rent.
Register of Landlords
All landlords will be legally required to register themselves and their property on a new portal database. If Landlords fail to register with the portal they will be fined. There is expected to be a charge for this portal.
It is also expected/ hoped that there will be a Property focused court set up to deal with the increased need for more formal possession procedures.