Revolutionising the rental sector: implications of the Renters (Reform) Bill
7th June 2023
Author EditorPosted on Categories Legal
The region’s property market is on the verge of a significant transformation, thanks to the government’s Renters (Reform) Bill, explains Simon Keeler, associate solicitor at Mayo Wynne Baxter.
This bill comes at a time when the rental sector is experiencing rapid digital evolution and changing lifestyle trends. The South East region boasts a diverse population and a large private rented sector, and it is poised to feel the full impact of the bill’s provisions. This article delves into the potential implications of the bill on landlords, tenants, and the overall property market in the region.
Privately Rented Property Portal
The Bill is set to revolutionise South East England’s property market. One of the bill’s key components is the creation of the Private Rented Property Portal, which will consolidate registered properties in a single, efficient digital platform. This move is expected to promote greater transparency and efficiency within the private rented sector.
Landlords can look forward to easy access to regulations and guidance, which will simplify the process of demonstrating regulatory compliance. This feature will likely reduce the regulatory burden on landlords and attract more potential property investors to the private rented sector. The Portal’s role as the primary communication channel for requirements further highlights its significance in the evolving rental property landscape.
Tenants can benefit from the Portal’s increased transparency and access to relevant property-related information. They can take effective action to enforce their rights and escalate issues with their properties, potentially resulting in improved tenant satisfaction and increased demand for rental properties.
The portal is also a game-changer for local councils, who will have reliable and comprehensive data on privately rented properties. This development will enable them to focus on enforcement rather than identifying poor-quality and non-compliant properties. In turn, this can pave the way for an improved rental property market in South East England.
Tenancy reform
The current rules allow landlords to use section 21 to conduct ‘no fault’ evictions. However, this has faced criticism, with some landlords being accused of misusing it to evict tenants who complain about property conditions. At the same time, responsible landlords can face difficulties regaining possession of their properties when faced with anti-social behavior or non-payment of rent.
To address these issues, the Bill will abolish section 21 evictions and introduce a new eviction process. Under the new law, landlords will only be able to terminate a tenancy under specific circumstances defined in the law. Tenants, on the other hand, can terminate their tenancy anytime by giving a two-month notice aligned with the end of a rent period.
If a tenant fails to vacate, the landlord must prove in court that their reason for eviction aligns with the specified legal reasons. The legislation does not specify the required evidence, offering landlords some flexibility.
Under the new system, rent increases are permitted, but tenants can challenge any increase deemed above the market rate by referring the case to the First-tier Tribunal.
The Bill will be implemented in two stages, giving stakeholders sufficient notice to adapt. All new tenancies will follow the new rules after the first implementation date, while all existing tenancies will transition on the second date, ensuring clarity and preventing a two-tier rental sector.
Private Rented Sector Ombudsman
The Bill requires all private landlords in England to join a government-approved redress scheme, administered by a singular Ombudsman. This offers an efficient and fair alternative to court proceedings for dispute resolution, tackling issues including landlord behaviour and property standards. The Ombudsman can order remedies and award compensation up to £25,000. Non-compliance may lead to penalties, including prosecution. While the appointed organisation is not yet confirmed, the service is intended to provide optimal value for both landlords and tenants.
Renting with pets
The Bill also seeks to foster a more pet-friendly rental environment. It mandates that landlords cannot unreasonably withhold consent when a tenant requests to have a pet in their home. Additionally, to alleviate landlords’ concerns about potential damage caused by pets, the Bill allows them to require insurance covering pet damage. This proposal aims to strike a balance between the interests of landlords and tenants and could serve to broaden the appeal of rental properties to pet owners.
As with any legislative reform, the ultimate impact of the Bill will depend on its implementation and reception by landlords and tenants alike. However, the potential for enhancing transparency, broadening the tenant base, and invigorating property market activity could make the Bill a promising development for the region’s property market.