Following much anticipation, on 23 October 2023, the Renters (Reform) Bill progressed to a Second Reading. The debate saw Michael Gove re-affirm the Conservatives’ commitment to an accelerated timetable which, all being well, should see the reading of the Bill completed by Christmas, as originally intended. It is clear we will see a lot of changes to the Bill as it moves through the Bills Committee and in the Third Reading, however, we highlight some of the standout points from the Second Reading below. An amended version has not been published, yet.   

Abolishment of section 21 notices

Despite the numerous articles published over the weekend which reference an indefinite stay on the abolishment of section 21 notices whilst the Court system undergoes reform, it is clear the Government has no plans to see this abolishment delayed any longer than necessary.

The Government’s response to the Levelling Up, Housing and Communities Committee report outlines four target areas for improvements to the Court system:

1. Digitising the Court system to make it simpler and easer for landlords to use;
2. Prioritisation of certain cases, specifically antisocial behaviour;
3. Improving bailiff recruitment and retention; and
4. Providing early legal advice and better signposting for tenants.

Whilst these proposed reforms have been hailed by landlord representatives as placing the section 21 abolition on hold, there is no clarity on exactly how these target areas will be measured and when the Courts will be deemed “sufficiently improved”. It is likely the Government will already claim they are making progress in relation to antisocial behaviour prioritisation, bailiff recruitment and signposting for tenants. Therefore, it remains to be seen how the Department for Levelling Up, Housing and Communities with work alongside the Ministry for Justice and HMCTS to deliver the above Court reform and allow the Government to deliver on their 2019 manifesto pledge. The Government will, in effect, be marking its own homework without clear criteria for success being set out. Furthermore, a new Labour Government will not be bound by the current Government’s promises of delay and Court reform, so in theory a Labour Government could activate the abolition of section 21 immediately upon coming into power if the Conservatives do not effect the changes before the end of their term.

Private student rental

Since the publication of the Bill, landlord representatives have been lobbying against the Government in relation to much needed amendments to the treatment of private student rentals. There was an overwhelming concern that the Bill as drafted would result in a housing crisis in the student sector, as landlords would be unable to obtain vacant possession of their properties in advance of the new academic year.  

Whilst the Government have re-affirmed their position that purpose-built student accommodation should be exempt and treated differently to private student rentals, there has been a welcome introduction in the form of a new ground for possession. The details of the ground for possession are yet to be published (or more than likely yet to be drafted), however, the National Residential Landlords Association (NRLA) have provided a suggestion which may inform the Government’s drafting. The NRLA have suggested that landlords should be required to provide the tenants with written notice at the commencement of the tenancy, advising that vacant possession of the property will be required at a certain point to allow for incoming students. Any attempts to obtain vacant possession will not be allowed until the end of the academic term.

Whilst it is a starting point, it is evident the ground and its practicality will need further consideration. However, what is clear, is that fixed-term tenancies will be abolished, and student landlords will be unable to demand a specific date at the commencement of the tenancy that their property should be returned. There were concerns raised in the House of Commons yesterday about whether a “one size fits all” students approach will be effective considering the wide range of different types of students and accommodation arrangements. It does not look like this is something which has been addressed or considered by the Government, yet, but we will have to wait and see the detail of the proposed new ground.

Ancillary points

In a welcome inclusion for tenants, the Government has confirmed its commitment to the Decent Homes Standards. However, in order to ease the burden on landlords, and to avoid the cost of such works being passed onto tenants, its implementation will be extended.

The commitment to introducing the Property Portal and Property Ombudsman was reaffirmed, with the aim of the Property Ombudsman being to provide a single and more streamlined scheme for landlord and tenants alike. The Property Ombudsman and/or local Council will also be responsible for sanctioning landlords for discriminating against prospective tenants due to having children or being in receipt of DSS. In practice, without clear, objective and measurable evidence, this could prove difficult to enforce. Furthermore, as long as there is a huge discrepancy between the levels of demand and supply of private housing, landlords will be able to decide who they let to and there will be little if anything that can practically be done to look behind the reasoning for a landlord’s decision. A ban on blanket marketing practices will not address this issue effectively.

Finally, in a welcome addition to landlords, it was confirmed that the Tenant Fees Act 2019 would be amended to allow for landlords to charge tenants for the cost of obtaining pet insurance. The Government also clarified that tenants will not have an automatic right to keep a pet in the property if the landlord initial refuses, unless and until the Ombudsman or Court rules that the landlord acted unreasonably. Rather unhelpfully, a clear definition of “unreasonably withholding consent” is yet to be provided, although there are some common law principles which may assist

Conclusion

There is a clear political aim to complete the drafting of the Bill by Christmas, to allow for implementation in Autumn 2024. Ultimately, there is still a way to go before the Bill is in force, and it is clear a lot of changes discussed during the Second Reading will need to be considered by the Bills Committee.

Should either landlords or tenants require assistance in navigating this complex legal environment, please do not hesitate to contact us.​​​​​