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Renters (Reform) Bill Unveiled | Rental Market Update

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Few can disagree that private renters have been up against it in recent years. We take a look at the latest changes coming down the line for the private rental market.

Rental reform bill

The homes renters worked from during the pandemic were sometimes unsuitable. Rents have risen, a lot as demand has exceeded supply! Also, a small but significant number of rental properties are in poor condition. So some good news for renters that has been long overdue.

Landlords typically generate less public sympathy, but they have had to cope with many new regulations, higher taxation and now rising interest rates. In short, buy-to-let is no longer as straightforward or profitable as it used to be.

A healthy private rental sector

We need a healthy private rental sector. It provides 11 million renters with homes and 2 million small-scale landlords, with an income.

The Renters (Reform) Bill, recently published and is now going through Parliament – is more than just another piece of red tape and a significant change. Let’s break down seven of its most significant proposals.

Ending ‘No Fault’ evictions

Currently, tenants can be evicted for no obvious reason and some accuse landlords of using this against renters who complain or request repairs. The charity Shelter claims nearly 230,000 private renters have been evicted this way since early 2019.

The Renters (Reform) Bill will ban ’no fault’ evictions. In return, landlords will have stronger powers to remove anti-social tenants and those in arrears.

Landlords in an Ombudsman Scheme

This will arbitrate disputes between tenants and landlords over rent rises, pets or other issues.

The Ombudsman will work like the one now operating for estate agents. It will oblige landlords who are in the wrong to make redress whether that’s an apology, remedial action or compensation.

Compulsory register

The government calls it a ‘rental portal’ operated by local authorities. Tenants, council officers and the police will also be able to check whether a landlord has registered and whether there have been any past problems. For example, poor maintenance or overcrowding.

Better housing standards

The government says 500,000 of the 11m private rental homes pose “an imminent risk to tenants” with issues like damp and mould.

Now the Bill will make a Decent Homes Standard (currently existing for council and housing association homes) apply to private rental flats and houses.

Pets allowed

Landlords cannot unreasonably refuse a tenant’s request to keep a pet. However, the regulations may ask renters to take out insurance in case the dog chews the carpet or the cat claws the sofa. Current estimates suggest that only one in nine landlords allows pets in their rental properties, indicating a potentially far-reaching change.

No more discrimination

It will be illegal for landlords or letting agents to have blanket bans on renting to families with children or those in receipt of benefits. Households with dependent children make up 30 per cent of the private rented sector.

Better enforcement

New regulations have no purpose if there’s no enforcement. Therefore, the government will legally obligate local councils to report the number of rogue landlords and tenants against whom they have taken action and the success of those actions.

There’s a promise of more funding for courts, too, to slash delays in cases involving anti-social tenants.

Although many say all this looks like a ‘tenant’s charter’ there’s little to alarm the responsible landlords who make up the overwhelming majority of people renting properties.

Unintended Consequences

However, if landlords feel these are yet more regulations on top of the many introduced in recent years, it’s possible that an unintended consequence will be that more quit.

There are already over 150 national laws governing private renting.

Hamptons estate agents say that 35,000 more homes were sold by landlords in 2022. While Zoopla reports one in every nine homes on the market now is a landlord selling up.

This could worsen an already-worrying shortage of rental properties.

However, the root of our housing crisis lies in the shortage of new homes being built for the households that need them.

Housing Supply

I’m not one for banging political drums but as the next General Election nears I would like to see serious promises of action on housing supply from whoever gets into Number 10.

The Renters (Reform) Bill, is likely to take a year to go through Parliament and turn into law. Eviction changes might be fast-tracked as this is more specific.

However long it takes, this heralds the start of a revolution in the private rental sector…and may just fire the starting gun for the housing debate amongst our politicians too.

Last Updated: May 30th, 2023