Renting Reform Bill – Latest Updates
In the Kings Speech 2023, the Government reiterated its commitment to getting the Renters or Renting Reform Bill through Parliament and passed into law. It also set out further amendments that the Government proposes to introduce to the Bill, including:
No fault possession notices
Our First article, published after the first reading of the Bill (read it here), sets out its key features, including the fundamental principle that “no fault” possession notices (section 21 notices), should be abolished.
In the supplemental notes to the Kings’ Speech, the Government confirmed that it does not intend to proceed with the abolition of section 21 notices until Court reforms have taken place to speed up the process of giving possession orders.
Currently, after serving a section 21 notice, and if the landlord has complied with duties relating to the provision of certain certificates and information, a court order for possession can be granted without the need for a hearing, using the accelerated procedure. The end of ‘no-fault’ evictions will mean more cases will be put through the courts, as fault must be proved by the landlord. Landlords are therefore concerned that a ban on no fault evictions could not only make evicting problematic tenants harder, but also significantly increase the time taken to regain possession due to the severe backlogs and delays in the court system.
The Government recognises that speeding up the courts process is essential so landlords can quickly regain possession of their property if a tenant refuses to move out. It is therefore making an initial commitment of £1.2 million to begin designing a new digital system for possessions. As work progresses, the Government proposes engaging with landlords and tenants to ensure the new system supports an efficient and straightforward possession system for all parties.
There is no indication how long this process will take and it is difficult to see how this significant undertaking can be achieved with speed. It is therefore unlikely that section 21 notices will disappear in the near future which may bring some relief for landlords.
Renting to tenants with children or in receipt of benefits
Provisions will be added making it illegal to have a blanket policy of not renting to tenants with children or tenants who receive benefits.
A criticism of the Bill, as originally drafted, was that landlords of students in the private rented sector would no longer be able to grant fixed term tenancies and quickly get back possession. The student letting market is based upon the expectation of short -term lets which are aligned to the academic year. The Government has not agreed to retain fixed-term tenancies for private rented student lets but will introduce a new ground of possession to allow landlords to recover student houses. Further details are awaited but Landlords will remain concerned if achieving possession will still take time and money and they will not have the certainty of being able to grant new student lets at the start of each academic year.
The Government also announced it was scrapping proposals to require landlords to meet EPC Rating C from 2025 in their private rented residential properties. This follows the Prime Minister’s prior announcement to the same effect in September 2023. The minimum EPC rating for the letting of residential properties will therefore remain at E with EPC ratings of bands F or G being ‘substandard’ and subject to the prohibition of granting new tenancies or continuing to let substandard premises.
We will ensure we provide further updates, as and when required.
For more information on how the Renting Reform Bill could affect you and the properties you own and rent…Talk to Tollers on 01604 258558, our highly knowledgeable Commercial Property team are on hand to provide the latest updates in regard to the progress of the bill.