Latest developments in Renters’ Rights Bill: What landlords need to know
On the brink of becoming law, the Government last week rejected the majority of amendments put forward by the House of Lords, which would have mitigated the severity of some of the amendments. Property professionals, landlords and tenants are poised to navigate this once-in-a-generation overhaul of housing legislation.
Lucy Jones, Chief Operating Officer at Lomond, recaps what landlords need to know about the rejected amendments:
1. The Bill is still going ahead and will soon become law
The Bill is well on its way to Royal Assent, currently in its ‘ping pong stage’. It is highly anticipated it may become law ahead of Party Conference season.
The Bill is structured so that most reforms will come into force immediately such as abolition of S21, introduction of new possession grounds, end of fixed term tenancies and rent-in-advance restrictions – whilst the landlord database and potentially the Ombudsman requirement will follow later, after a transition period to allow the sector to adjust and infrastructure to be put in place.
It is expected that the final Bill will become the Renters’ Rights Act this Autumn, meaning landlords have only a matter of weeks to make their final preparations ahead of the significant changes.
2. No requirement for separate pet deposit
One of the suggested changes would have let landlords request a separate pet deposit of up to three weeks’ rent, on top of the usual deposit cap, but that idea was turned down. The Government said the current five-week limit already covers potential damage, and adding more would make things harder for tenants financially.
3. No requirement for pet insurance
Requiring tenants take out pet insurance was also rejected, with Government noting that the insurance industry is not yet ready to offer suitable products at scale. Whilst pet owners can take pet insurance out if they wish, it won’t be something landlords can enforce.
4. No change to the 12-month re-letting restriction after a failed sale
Another change that didn’t make it through was a plan to shorten the timeframe a landlord has to wait before re-letting a property after asking a tenant to leave in order to sell. The House of Lords suggested reducing it from 12 months to six, but this was also rejected. The Government asserted the full year is important to stop landlords from abusing the grounds of repossession.
5. No extension of student possession grounds to smaller properties
Allowing landlords to use the student housing ground for possession for smaller properties, like one- or two-bedroom flats and not just HMO’s, was also rejected. The Government said that the current rules already strike a fair balance and help protect students who don’t fit the typical mould, like postgrads and students with dependents.
Whilst the finer details are still to be solidified, the industry is anticipating the imminent passing of the Bill and is eager to establish the final version of the legislation in order to prepare.
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