The Renters Reform Bill will shortly be brought in to law by the UK Government provided the bill passes through the relevant steps in parliament.
The bill will abolish section 21 and bring an end to ‘no fault’ evictions.
The idea is to provide tenants with greater security, but still leave landlords confident they can retake possession of their properties if they need to.
The bill is intended to help reduce the amount of poor quality rental properties, allowing tenants to complain about conditions without the risk of being evicted by Landlords looking for an easy way out.
Does this change affect Landlords renting a room?
Where a Landlord rents a room in their own home or indeed they have rooms to rent in HMOs or other shared property, it is likely they will be bound by the same rules.
ASTs will be replaced by periodic tenancies and the quality of a property should in any event, be up to a certain standard as set out by a local council and the terms of a Landlord’s licence where one is required.
So what does the Bill hope to achieve?
In a nutshell, to protect a tenant from eviction and ensure the property is up to a required standard. Also, to protect a landlord where there are grounds for eviction.
The Bill still allows eviction of tenants where there is fault such as for rent arrears or damage and lack of care to a property.
The Bill will end fixed-term tenancies in favour of periodic tenancies, which wouldn’t have an end date.
This is unlikely to affect many landlords as in a lot of cases an Assured Shorthold Tenancy or AST, will have a fixed period and then be allowed to roll over to a periodic tenancy without an end date in any event.
A periodic tenancy will allow tenants to vacate the property early, with the relevant notice period, and not be lbound by a minimum term as in the case of an AST.
The onus will be on the Landlord to ensure the standard is as expected in order to retain a tenant, giving the tenant greater security.
That is how it is expected to work although in practice that may not be the case. With reduced rental stock and high demand, a tenant may think twice about handing in notice even where expected standards are not reached.
Therefore, it is possible the Bill won’t have the expected outcome.
On the flip side, it is also intended that, whilst a landlord can’t evict a tenant without good grounds, the process for eviction where there are should be simplified in order to be able to evict tenants for anti-social behaviour, persistent rent arrears and other reasons. Whilst a landlord won’t be able to evict a tenant within the first six months of a tenancy agreement should they wish to sell or move in to the property themselves, this will be allowed after 6 months in certain circumstances if needed.
The Bill also aims to protect tenants from excessively high rent rises which could be used as a backdoor eviction process as Section 21 can’t be used. Rents can be increased but must be based on market value. Where a tenant feels a rent increase is above market value they are able to challenge this in tribunal, where the tribunal will attempt to determine the market value.
Whilst on the face of it, the abolition of this Bill seems to make sense, many landlords feel it is another step in curbing the appeal of being a Landlord in the first place. Many will either sell rented properties or reduce a portfolio, others may not wish to enter the rental market as a landlord. However, if a rental property is up to the expected standard there shouldn’t really be too much to concern most. After all, this change is intended to curb landlords who profit from unsafe, poorly maintained houses. It should hopefully improve the quality overall of housing stock in the UK.
It may be some time before any benefits, or otherwise, are apparent. If landlords feel it is now not beneficial to own rental property and look to sell and move out of the market, it will obviously increase demand and reduce available stock. This will have the effect of pushing up market values and therefore affecting remaining tenants in higher rents and less availability. It is difficult to evaluate whether this change will be for the good or bad and may be some time before it can be fully assessed.
Have your own Rooms To Rent?
If you have available rooms to rent, you can find tenants on RoomsForlet. Simply register a landlord account and begin adding your room details. These will be matched against available tenants and a room advert will be placed for tenants to make enquiries.
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Please feel free to share your thoughts on the abolition of Section 21 via our Contact page and we will add any comments we see fit, to this post.