We have already discussed how the ‘a fairer private rented sector white paper’ will affect tenants in a previous blog, which you can read here. But how will the ‘a fairer private rented sector white paper’ affect landlords and letting agents? As experts in house MOTs or property MOTs, we here at House MOT will now explain the ramifications of this new ‘Renters Reform’ bill for landlords in the PRS.
But before we go through some of the main proposals from the ‘a fairer private rented sector white paper’ here is a quick recap of why this legislation has been passed through the House of Commons. In the modern age more and more of us are not able to afford our own homes. In fact, over 13 million UK residents rent privately. Of those, nearly 3 million live in conditions which are considered poor, with very few laws protecting tenants from living in below-par properties. The ‘a fairer private rented sector white paper’ outlines the Government’s aims to deliver a fairer and ultimately higher quality PRS, by halving the number of non-decent privately rented properties by 2030, whilst for the first time requiring privately rented properties to meet a ‘Decent Home Standard’.
Here are some of the main proposals from the white paper that will affect landlords.
The abolishment of Section 21 notices
Previously, a ‘no fault’ Section 21 allowed landlords to evict tenants and terminate tenancies without a reason. This will no longer be the case. Landlords will only be able to terminate tenancies by serving a section 8 notice with stated ground. These will include landlords who want to sell the property or landlords who will be allowing close family members to move into the property. Other grounds for eviction will include tenants who have been in at least 2 months of rent arrears on at least 3 different occasions within the previous 3 years.
All tenancies will now become ‘periodic’
A single system of periodic tenancies will now apply to all tenants, allowing tenants greater flexibility to relocate should their circumstances change, or if their housing is shown to be of poor quality.
Tenancy agreements that include ‘rent review clauses’ will be banned. In the proposed changes a landlord will only be able to increase property rents once every year, which will involve serving the tenant with a formal Section 13 notice. This will make the required rent increase become 2 months, instead of the previous 1 month’s notice period. Tenants will still be able to challenge this rent increase should they wish, through the First Tier Tribunal.
Removing landlords’ bans on pet owners
No longer will landlords be able to refuse tenancy to tenants with pets (subject to the obligations of any head lease restrictions). The current Tenant Fees Act 2019 will be amended to include pet insurance for pet owners, to offer assurances to landlords that pet owners will be liable for damages to property by pets.
Discrimination against those on benefits or those with children
The ‘a fairer private rented sector white paper’ also states that it will now be illegal for landlords and letting agents refusing to accept tenants who have children, or who are on benefits.
A newly created Ombudsman will allow disputes between landlords and tenants to be heard and settled quicker than previously, also at a lower cost to both and without the need to go to court. The Ombudsman will also have the power to issue apologies, and take remedial action or pay compensation where required.
Under the proposed bill it will be mandatory for all landlords to register on a new portal which will ensure landlords, tenants and local councils will have any information they require. Local authorities will enforce this and will incorporate the Database of Rogue Landlords and Agents, which will be available to the public.
Find out more about the ‘a fairer private rented sector white paper‘
The points above are the main proposals that will directly affect landlords and letting agents, but if you wish to learn more about the ‘a fairer private rented sector white paper’ and how it may affect you then please contact our expert team at House MOT. Alternatively, you can view the government’s 12-point plan here.