Big Changes Ahead: What the Renters' Rights Bill Means for You

The rental market is on the brink of a significant transformation with the introduction of the Renters’ Rights Bill by the Labour Government on 11th September 2024. This new bill builds on the earlier Renters (Reform) Bill, which was shelved during the 2024 General Election. While the core principles remain the same, the name change reflects a broader commitment to strengthening tenant protections and rebalancing the rental market.

By adopting a fresh title, the Renters’ Rights Bill signals a renewed focus on empowering tenants while ensuring landlords are supported in maintaining their properties to a high standard. The bill, which had its First Reading in Parliament on 11th September 2024, is already progressing through the legislative process. The Second Reading, a critical stage where MPs debated the proposed reforms, took place on 9th October 2024. With the bill moving steadily through Parliament, it is expected to become law by summer 2025, introducing some of the most significant changes to tenancy laws in decades.

The Government has stated that this bill will improve the current system for both the 11 million private renters and 2.3 million landlords in England. It aims to provide renters with greater security and stability, helping them stay in their homes for longer, build lives in their communities, and avoid the risk of homelessness. At the same time, it seeks to create a fairer and more transparent framework for landlords. Here’s what you need to know about the upcoming reforms and how to prepare.

One of the most talked-about reforms is the abolition of Section 21 “no-fault” evictions. Under the new rules, landlords must provide a legally defined reason to end a tenancy, such as rent arrears or the need to sell the property.

While this reform offers greater stability for tenants, landlords may face challenges regaining possession of their properties. To address this, the bill introduces clarified and expanded grounds for possession, ensuring landlords can reclaim their properties when necessary while protecting tenants from arbitrary evictions. For instance, tenants will benefit from safeguards such as a 12-month protected period at the start of a tenancy, during which landlords cannot evict them to move in or sell the property. Additionally, landlords will need to provide four months' notice when using these grounds, giving tenants more time to find a new home.

The Renters’ Rights Bill introduces significant changes to how rents can be increased. Under the proposed rules:

• Rent increases will be limited to once per year: Landlords will no longer be able to impose frequent rent hikes, providing tenants with greater financial predictability.
• Mandatory two months' notice for rent increases: Tenants must be given ample time to prepare for any changes in their rental costs.
• Abolition of rent review clauses: Fixed automatic increases that may not reflect the market will be replaced with a simpler, more transparent system.
• Protection against excessive rent demands: Tenants will have the right to challenge rent increases they believe exceed market rates at the First-tier Tribunal, without the risk of the tribunal raising the rent beyond what the landlord initially proposed.
• No backdating of rent increases: New rents will only apply from the tribunal’s determination date, ensuring tenants are not suddenly burdened with debt.

These changes aim to create a fairer rental market by balancing landlords' ability to maintain profitability with tenants’ need for affordability and stability.

One of the standout features of the Renters’ Rights Bill is its focus on pets. The legislation grants tenants the right to request to keep pets in rental properties. Landlords must reasonably consider these requests and cannot unreasonably refuse them. This marks a significant change from the blanket “no pets” policies that have been common in the rental market.

To support this, the Tenant Fees Act 2019 will be amended to allow landlords to require tenants to take out pet insurance as a permitted payment. This ensures landlords have the peace of mind that any damage caused by pets will be covered, while tenants are empowered to live with their furry friends.

If a landlord denies a pet request, tenants will have the right to challenge the decision through the newly introduced Private Rented Sector Ombudsman. This change strikes a balance between protecting landlords’ properties and ensuring fairness for tenants.

The Renters’ Rights Bill also seeks to promote fairness by banning discrimination against families with children or tenants receiving benefits. Blanket “no DSS” policies will no longer be permissible, ensuring that vulnerable renters aren’t unfairly excluded from the housing market.

The Renters’ Rights Bill aims to improve living standards by introducing the Decent Homes Standard to the private rental sector (PRS). This standard, already applied in the social housing sector, will ensure rental properties are not only safe but also comfortable and well-maintained.

Here’s what the Decent Homes Standard entails:

• Free from Serious Health and Safety Hazards
  Landlords will be required to address critical issues such as mould, damp, faulty wiring, or fire risks within a set timeframe. These hazards not only compromise the health of tenants but can also lead to significant financial penalties for landlords if left unaddressed.
• Adequate Heating and Insulation
  Properties must be energy-efficient, warm, and free from excessive draughts or cold spots. Landlords may need to make upgrades, such as improving insulation or replacing outdated heating systems, to comply with the new requirements.
• Functional Kitchens and Bathrooms
  Homes must have modern, clean, and functional kitchen and bathroom facilities. Landlords will need to ensure these spaces are appropriately equipped, free from leaks, and in good working condition.
• Noise Insulation
  To enhance tenants’ quality of life, properties must have appropriate measures in place to minimise excessive noise, particularly in multi-tenant buildings.
• General Cleanliness and Maintenance
  Properties must be free from pests, have secure windows and doors, and maintain a general standard of cleanliness. Basic maintenance issues, such as broken fixtures or damaged flooring, will need to be resolved promptly.

To ensure compliance with these standards, local councils will be given new enforcement powers, including:

• Fines of up to £30,000 for landlords who fail to meet the standard.
• The ability to issue banning orders for repeated or severe violations.
• The option for tenants to claim up to 24 months’ rent repayment for properties that fail to meet the standard.

These measures are designed to protect tenants while encouraging landlords to proactively maintain their properties.

A government-backed Property Portal will centralise information, helping landlords navigate their obligations while enabling tenants to check property compliance. A mandatory Private Rented Sector Ombudsman will also be introduced to resolve disputes more efficiently, offering quicker and less costly alternatives to court proceedings.

With the Renters’ Rights Bill expected to become law by summer 2025, now is the time for landlords to review their practices. Here are a few key steps to get started:

• Inspect properties: Ensure they meet the Decent Homes Standard and address any potential hazards.
• Update tenancy agreements: Reflect new rules on pets, rent increases, and notice periods.
• Stay informed: Keep track of the bill’s progress to anticipate further updates.

At Stewarts Estates, we’re committed to guiding landlords and tenants through these changes. Whether you’re looking to understand the finer details or need help updating your rental practices, we’re here to help.

The Renters’ Rights Bill represents a significant shift in the rental market. While it introduces challenges for landlords, it also offers an opportunity to create a more equitable and transparent system for everyone involved. With careful preparation and the right support, navigating these changes doesn’t have to be daunting.

If you have any questions or need assistance adapting to the upcoming reforms, feel free to reach out to the Stewarts Estates team. We’re here to make the transition seamless for both landlords and tenants.