Renters Reform Bill - What are the changes & when will it become law?

By Georgia Galloway | Wednesday 15th May | 12 minute read

The Renters Reform Bill is one of the most significant pieces of legislation for private renters and landlords in the past 30 years.

The Renters (Reform) Bill, introduced to the UK Parliament in 2023 and currently advancing through its legislative stages, is set to transform the UK rental sector. This bill promises to eliminate "no-fault" evictions, enforce periodic tenancies, expand tenant rights—including the right to own pets—and establish both a new ombudsman and a property portal to support fair interactions in the rental market. 

While it has faced several delays and sparked controversy among landlords, tenants, and campaigners on both sides, its potential to significantly alter landlord responsibilities and tenant security remains a pivotal point of discussion. With the House of Commons having passed the bill, its future effectiveness hinges on its passage through the House of Lords and the resolution of ongoing debates about its provisions and impacts.     

Renters Reform Bill - What are the changes and when will the Renters Reform Bill become law?

The Renters (Reform) Bill, first promised by the Conservatives five years ago and introduced to Parliament in 2023, aims to overhaul rental regulations in England by ending "no-fault" evictions, introducing periodic tenancies, enhancing tenant rights, including pet ownership, and establishing a new ombudsman and property portal to support fair dealings in the rental sector.

As Stephen Clark, from property bridging finance broker Finbri, says, “The Renters Reform Bill is set to introduce many more rules and regulations for landlords, adding new requirements and limits on what they can do. Landlords are feeling pressured to follow the proposed changes. Many landlords have voiced their concerns about the bill, especially the abolition of Section 21, and its introduction could be another reason landlords are looking to sell up and leave the rental market.

"Even though the bill is currently in the House of Commons, it's still five stages away from becoming law, and our 2024 Landlord survey highlights the difficult position landlords find themselves in, with 32% looking to sell up, yet 51% looking to further invest in property in 2024.”

After experiencing numerous delays and causing controversy among landlords, tenants, and campaigners on both sides, the bill has finally passed through the House of Commons. However, the question remains: when will it officially become law?

What is the Renters Reform Bill? 

The Renters (Reform) Bill, presented by the Government in 2023, proposes significant changes to rental regulations in England, affecting landlords and tenants. 

The concept for this bill was initially suggested in 2019 and detailed further in the 2022 Fairer Private Rented Sector white paper.

Here is the timeline of events (so far):

  • First reading: 17th May 2023 
  • Second reading: 23rd October 2023 
  • Committee stage: 28th November 2023 
  • Third reading: 24th April 2024
  • House of Lords readings: May 2024

The Renters Reform Bill has successfully passed the House of Commons. During the third reading on April 24th, the House voted on the proposed amendments:

  • New clause 15, an initial 6-month tenancy before tenants can serve notice to quit. The updated provision specifies that a tenant can issue a notice period of two months (unless the landlord consents to a shorter notice period), which cannot commence until at least six months have passed since the start of the tenancy. This amendment was accepted.
  • New clause 30 evaluates the effectiveness of the county court possession order process in England and enforcement measures. This amendment was also accepted.

What key measures of the Renters Reform Bill?

The Renters Reform Bill is one of the most significant pieces of legislation for private renters and landlords in the past 30 years. The government says the bill will deliver on its commitment to 'bring in a better deal for renters".

Key measures include the abolition of Section 21 ('no-fault') evictions, a new system for periodic tenancies, changes to rent increase notice periods, increased rights for tenants with pets, a new ombudsman for all private landlords and a property portal for advice and guidance for landlords and tenants.

Abolition of Section 21    

Under current guidelines, landlords can remove their tenants by serving a Section 21 notice, which provides a two-month notice period after the fixed-term contract expires. Section 21 allows landlords to evict without stating a reason, hence termed 'no-fault' evictions. Our 2024 Landlord report found that 13% of evictions in 2023 resulted from landlords using Section 21.

Landlords have continually criticised the abolition of Section 21, stating that it would make it more difficult to remove tenants causing problems (anti-social behaviour/rent arrears, etc.) as Section 8 is a much longer and costly process. 

The Renters (Reform) Bill is set to scrap section 21, or "no-fault eviction," offering renters more stability. Landlords will need valid grounds instead of evicting without reason, giving tenants more security. 

Parliament is debating amendments to the bill, including delaying the ban on no-fault evictions until determining if courts could deal with an increase in repossession claims.

New system of periodic tenancies

The Renters (Reform) Bill will eliminate fixed-term tenancies and transition to periodic agreements from the outset. Tenants must provide a two-month notice period to end their tenancy and notice periods exceeding two months will be prohibited. Removing fixed-term tenancies allows tenants to give notice at any point during their tenancy.

For landlords, the ability to provide tenants with two months' notice will apply in cases of selling the property or personal occupancy. Notice periods for other grounds (for example, anti-social behaviour or rent arrears) will vary. Attempting to enforce a fixed-term tenancy may result in penalties given by the local authority.

Rent increase notice period to be doubled

Landlords must give tenants 1 month's notice before increasing the rent. Doubling this notice period, meaning 2 months, gives tenants more time to prepare for financial adjustments. 

This provides tenants with greater stability and predictability in their housing costs. Additionally, it allows tenants more time to negotiate with their landlord if they believe the proposed rent increase is unfair or unreasonable.

More rights for tenants to keep pets

This aspect of the bill acknowledges the importance of pets in many people's lives and aims to ensure tenants are not unfairly restricted from having pets in rental properties. 

However, only 7% of advertised properties are pet-friendly, with half of UK households owning at least 1 pet. Unsurprisingly, this clause has been included as part of the Renters Reform Bill; by allowing tenants the right to keep pets, the bill promotes a more inclusive and accommodating approach to renting.

New ombudsman for all private landlords

Introducing a new ombudsman specifically for the private renting sector aims to address accountability, transparency, and dispute resolution issues. This independent body will mediate between landlords and tenants, helping to resolve conflicts and grievances fairly. 

By providing a centralised point of contact, the new ombudsman can help streamline the resolution process and ensure that landlords and tenants are treated fairly.

This contrasts with the current requirement for agents to be members of The Property Ombudsman, which has been a legal obligation.

New property portal for landlords and tenants

Creating a dedicated property portal is a valuable resource for landlords and tenants. It offers easy access to information, advice, and services related to renting properties. For landlords, the portal can provide guidance on legal requirements, rental market trends, and best practices for managing rental properties. 

It can offer tenants information on their rights and responsibilities and tools for finding suitable rental accommodations and resolving disputes with landlords. By centralising these resources in a user-friendly online platform, the portal aims to promote transparency and efficiency.

When will the Renters Reform Bill become law? 

Although there is still no official date for its publication, it has been strongly speculated that it will become law in Autumn 2024.

It's been five years since the bill was first proposed, but as recently as April 2024, over 200 amendments were made to the Renters Reform Bill prior to its Third Reading in the Commons. So further delays are perhaps inevitable.

What does the renters reform bill mean for landlords?

The introduction of the Renters (Reform) Bill will positively impact landlords in three key ways: strengthened grounds for possession, improved court processes, and greater transparency.

What are the potential positive impacts on landlords?

  1. Strengthened grounds for possession: The bill promises to enhance landlords' ability to regain possession of their properties, particularly in cases of rent arrears or antisocial behaviour. Our survey found rent arrears and antisocial behaviour to be the top reasons for eviction in 2023, so this would come as good news to landlords.
  2. Improved Court processes: To enhance court processes, the bill intends to digitise eviction proceedings, potentially reducing delays and inefficiencies in resolving disputes between landlords and tenants.
  3. Greater transparency: Introducing a property portal aims to provide tenants with transparent information about rental properties, helping them make informed decisions. This could foster better landlord-tenant relationships and reduce disputes arising from misunderstandings.

What are the potential negative impacts on landlords?

  1. Abolition of Section 21: Removing Section 21, or 'no-fault' evictions, could pose challenges for landlords. It could lengthen the eviction process and limit their ability to regain possession of their properties. Landlords may face increased uncertainty and administrative burdens in managing tenancies.
  2. End of fixed-term tenancies: Abolishing fixed-term tenancies in favour of periodic agreements may reduce landlords' control over tenancy durations and rental income stability. Landlords may encounter difficulties in planning for property vacancies and managing cash flow.
  3. Restrictions on rent increases: Limiting rent increases to once per year and extending notice periods may constrain landlords' ability to adjust rental prices in response to market conditions or financial needs. This could impact landlords' income streams and ability to maintain property investments.

Ben Beadle, chief executive of the National Residential Landlords Association, comments, "This Bill delivers a fair deal for tenants and responsible landlords. In the interests of certainty for the sector, it is now time to ensure the Bill passes through Parliament.

“For renters, the Bill will abolish section 21 repossessions and fixed term tenancies, introduce a Decent Homes Standard for the sector, a new Ombudsman and Property Portal which landlords will have to join as well as measures to protect families and those in receipt of benefits from discrimination.

“Going forward, it will always be for the courts to decide if landlords have met the threshold to repossess a property based on a series of legitimate reasons. This includes tenant anti-social behaviour, serious rent arrears or where a landlord plans to sell a property.

“That said, the tenant group, Generation Rent, has rightly warned that landlords selling properties is ‘a leading cause of homelessness.’ The only answer to this is ensuring responsible landlords feel confident enough to stay in the market. Greater security for tenants will mean nothing if the rental homes are not there in the first place.

“A number of the amendments proposed to the Bill enact recommendations by the cross-party housing select committee. Taken together, they would ensure a balanced Bill that protects tenants and ensures it is viable for responsible landlords to continue renting properties out.”

How do landlords feel about the Renters Reform Bill?

Our 2023 Landlords report discovered how landlords felt about the proposed measures: 

  • 48% of landlords were concerned that the reform makes it illegal for landlords and agents to refuse to rent properties to people who receive benefits.
  • 45% of landlords were concerned that the reform stops section 21 ‘no fault’ evictions
  • 44% of landlords were concerned that the reform introduces a private rented ombudsman to help enforce renters’ rights
  • 43% of landlords were concerned that the reform requires landlords to register their property on the new property portal legally
  • 41% of landlords were concerned that the reform ensures all tenants have the right to request a pet in their house, which the landlord must consider and cannot unreasonably refuse

What does the renters reform bill mean for tenants?

The government says the bill demonstrates its commitment to "bring in a better deal for renters", but campaigners say the promised banning of the practice of issuing "no-fault" eviction notices is taking too long.

The Renters Reform Bill promised greater security for tenants, but many currently feel very insecure about their housing situation, believing the laws have been "watered down" in favour of landlords.

Despite the concerns over delays, bill changes and possible ongoing negatives, should the Renters Reform Bill become law, there will be positives for tenants.  

What are the potential positive impacts on tenants?

  1. Abolition of Section 21 "no-fault" evictions: This change provides tenants with increased security and stability in their tenancies. They will no longer face the risk of being evicted without reason, allowing them to feel more secure in their homes.
  2. Introduction of rolling tenancies: Moving to a single system of periodic tenancies provides tenants with greater flexibility. They no longer need to worry about the uncertainty of fixed-term contracts ending and can enjoy the freedom of staying in a property for as long as they need.
  3. Increased rights for tenants with pets: The bill allows tenants to request permission to keep pets in their rented homes, and landlords cannot unreasonably withhold consent. This change gives pet-owning tenants more options and reduces the likelihood of them having to give up their pets due to rental restrictions.
  4. Establishment of a new ombudsman: Tenants will have access to a government-approved ombudsman to address complaints against landlords. This gives tenants a formal avenue for resolving disputes and holding landlords accountable for any issues.
  5. Enhanced housing standards: Applying the Decent Home Standard to the private rented sector ensures tenants can access safe and habitable housing. This change improves living conditions for tenants and protects them from substandard accommodation.

What are the potential negative impacts on tenants?

  1. Potential rent increases: While the bill introduces measures to limit rent increases to once yearly and requires landlords to provide two months' notice of any changes, tenants may still face higher rents over time. This could impact affordability for some tenants, especially in areas with high demand and limited supply.
  2. Uncertainty during the transition: As the rental market adjusts to the new legislation, tenants may experience some uncertainty or disruption. For example, the transition to rolling tenancies and the abolition of Section 21 evictions could lead to changes in tenancy agreements and rental practices, potentially causing temporary upheaval for tenants.
  3. Possible delays in court reform: The abolition of Section 21 evictions is contingent upon improvements to the court system, which may take time to implement. During this period, tenants may continue to face the threat of no-fault evictions until the necessary reforms are in place.
  4. Challenges in accessing redress: While establishing a new ombudsman is a positive step, tenants may still need help accessing redress, such as delays in processing complaints or limited enforcement powers. This could hinder tenants' ability to resolve disputes effectively.
  5. Impact on vulnerable groups: Despite measures to prevent discrimination against families with children or those on benefits, some tenants from vulnerable groups may still face challenges in accessing suitable housing. Structural issues such as affordability constraints and limited housing supply could continue to affect these groups disproportionately.

What are the biggest causes of tenant evictions?

Antisocial behaviour and failure to pay rent were the biggest causes of tenant evictions in 2023. Evictions in England rose by nearly 50%, with 9,457 households facing bailiff evictions. According to a 2024 report, 18% of landlords evicted tenants in 2023, citing antisocial behaviour (48%) and unpaid rent (47%) as top reasons. Section 21 'no-fault' evictions accounted for 13%. Evictions cause financial strain and emotional stress for tenants and financial losses for landlords. The proposed abolition of Section 21 aims to increase tenant security but faces legislative delays. Effective tenant screening and communication can help prevent evictions.

Are landlords still looking to invest in property?

Despite the challenges posed by factors like high interest rates, regulatory changes, and inflation, landlords still have considerable interest in property investment. According to the Finbri Landlord report, 51% of landlords are still looking to invest. Rental demand continues to increase, and current conditions still see potential in property investment. 

Historically, the property has been seen as a relatively stable investment, offering the potential for capital appreciation and rental income. Some landlords may take a long-term view, believing that property investment can yield favourable returns over time despite short-term challenges.

However, with increased costs and the predicted impact of the Renters Reform Bill awaiting publication, many landlords, particularly accidental landlords, are selling up. It all depends on market conditions, including fluctuations in property prices and local factors, which can create opportunities for investment in certain areas or properties. 

Why do landlords use bridging loans when investing in property?

Bridging loans are an attractive option for property investment. Bridge loans offer short-term funding solutions to cover renovation costs or unexpected expenses during conversion.

Bridging loans are flexible, distinguishing them from traditional mortgages or bank loans. They are arranged much faster than conventional mortgages and have shorter repayment terms, typically 1 to 18 months, depending on individual circumstances and lender policies. 

This enables investors to repay the loan quickly once the property generates rental income without being burdened by long-term financial commitments. As a result, investors can maximise their profits from their investment in rental properties.

Final thoughts

The Renters (Reform) Bill, first introduced in 2023 and now advancing through Parliament, seeks to reshape the rental landscape in England. 

This legislation aims to end "no-fault" evictions, establish periodic tenancies, and enhance tenant rights, including for pet ownership. Despite its passage through the House of Commons and ongoing debates in the House of Lords, the bill has stirred significant controversy among landlords, who express concerns about increased regulations and potential impacts on their ability to manage properties effectively. 

While 32% of landlords are considering exiting the market, a larger portion remains interested in expanding their investments, reflecting mixed reactions to the bill's implications. As the bill continues to evolve, its final form and implementation date remain uncertain, leaving landlords and tenants in a state of anticipation and preparation for the changes it promises to bring to England's private rental sector.

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