Labour’s Renters’ Rights Bill: A Comprehensive Overhaul to End No-Fault Evictions and Enhance Tenant Protections

What does Labour’s Renters' Rights Bill entail, and can it terminate no-fault evictions?

Labour has committed to enhancing the Renters Reform laws, which were initially pledged by the Conservatives but were never implemented.

Political correspondent @fayebrownSky

Thursday, September 12, 2024, 09:

The Renters' Reform Bill has returned to the House of Commons, following a delay of five years and the tenure of four different prime ministers since its initial proposal.

This time, it's Labour's turn as the newly elected ruling party promises to enhance and finalize the initiatives that the Conservatives initially committed to, then diluted, and ultimately discarded prior to the general election.

Currently known as the Renters' Rights Bill, this legislation seeks to "significantly balance the scales of justice for landlords and tenants," says housing minister Matthew Pennycook.

Sky News examines the contents of the proposed bill.

Ban imposed on no-fault evictions

Significantly, the new law will introduce a comprehensive prohibition on no-fault evictions as stipulated by Section 21 of the 1988 Housing Act.

Landlords can require tenants to vacate the property by giving them a two-month notice without needing to specify a cause.

Advocates for housing argue that they significantly contribute to the increasing number of homeless people.

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Former Tory leader Theresa May committed to abolishing Section 21 evictions on April 15, 2019, a pledge that was also included in the platform of her successor, Boris Johnson.

The Conservatives have declared an unspecified postponement of the proposed ban, awaiting judicial reforms, after facing pushback from landlord MPs within their own ranks.

The decision to hold the general election sooner than expected led to the abandonment of the initial proposals. However, upon delivering its first King's Speech, the Labour Party announced it would enhance the legislation previously introduced by the Conservatives, presenting a more robust version of the original bill.

Mr. Pennycook announced that the new administration is set to prohibit Section 21 evictions across all tenancies, both new and ongoing, with plans to implement this system by the upcoming summer.

He explained to LBC that this will prevent landlords from using a Section 21 notice to capriciously evict tenants, including those who raise issues such as dampness and mold, instead of addressing these concerns.

Landlords retain the right to remove tenants under lawful circumstances, such as when a tenant falls significantly behind on rent or engages in disruptive behavior.

Expansion of Awaab's Legislation

Awaab's Law is named in memory of a young child who passed away due to mold exposure in his family's social housing unit in Rochdale, Greater Manchester.

The proposal suggests that social landlords must assess risks within 14 days, address them within an additional seven days, and complete urgent repairs within 24 hours.

The Renters' Rights Bill proposed by Labour aims to broaden these protections to include the private sector, mandating that all landlords promptly rectify any hazards to ensure the safety of their properties.

Proposals are in place to enhance residential safety by extending the Decent Homes Standard to privately rented properties, marking its initial application in this sector.

Authorities have reported that 21% of homes in the private rental sector are deemed "non-decent," with over half a million exhibiting severe risks.

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Local councils will have the authority to impose fines of up to £7,000 on landlords who neglect to resolve significant risks, and these landlords could also be subject to legal action for failing to comply, according to statements from the government.

A fresh initiative will see the creation of a Private Rented Sector Landlord Ombudsman, tasked with delivering "speedy and definitive solutions" for grievances. Additionally, a database will be set up to assist landlords in comprehending their legal responsibilities and showing adherence.

Prohibition on raising rent during a lease

The legislation will additionally prohibit the inclusion of rent hikes in agreements, ensuring that landlords can only adjust rental rates annually and in accordance with the prevailing market conditions.

Rent advocacy groups are urging the government to implement rent controls as part of their response to the escalating housing affordability crisis.

Research conducted by the housing charity Shelter reveals that in 2024, private renters in England are spending an additional £473 million each month on rent compared to the previous year, averaging an increase of £103 per month.

The Labour Party has dismissed the idea of implementing rent controls, stating that their strategy to construct additional housing will reduce rental costs.

The authorities have announced plans to simplify the process for residents to contest steep rent increases that might otherwise displace them.

The proposed changes will overhaul the First Tier Tribunal to prevent it from requiring payments exceeding the original amount requested by landlords in tenant disputes.

The government will also halt retroactive rent hikes if they are approved by the regulatory authority, and will permit a two-month delay in rent increases for tenants experiencing financial difficulties.

Permitting animals

Labour's policy changes will enhance tenants' ability to request permission to have pets, which landlords will be required to consider and cannot reject without reasonable grounds.

Currently, there are no particular regulations governing pet ownership in rental properties, allowing landlords to refuse tenants with pets for justifiable reasons.

The Renters' Rights Bill is set to empower landlords by allowing them to ask for insurance to safeguard against possible pet-related damages when necessary.

Clamping down on bidding wars

The changes also put an end to competitive bidding among prospective renters.

Competition for rental homes has intensified due to a persistent lack of available properties, leading renters to pay, on average, an additional £100 per month beyond the listed price last year, a study from the New Economics Foundation reveals.

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The proposed legislation from Labour mandates that landlords and letting agents must disclose the asking rent for properties.

Property owners and representatives will be prohibited from soliciting, promoting, or receiving any offers that exceed the advertised price.

Comparable legislation has been enacted in other nations grappling with housing shortages, including New Zealand.

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Further Reading: Addressing Skyrocketing Rent: What Are the Solutions? Rental Prices Reach New Peak

Reform of rental

The legislation will eliminate fixed-term assured leases, obligating tenants to continue paying rent even if the property does not meet appropriate standards, and restricting their ability to vacate the premises promptly due to life changes like a new employment opportunity or a relationship ending.

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Rather, all leases will be on a rolling basis, allowing tenants to remain in their residence until they choose to terminate the lease by providing two months' notice.

If a landlord needs to sell their property or move back in, they are now required to provide tenants with four months of notice, an increase from the previous two-month requirement.

Every tenant will be granted a one-year safeguard from eviction at the start of their lease, where landlords are not allowed to evict them for specific reasons.

Prohibition of discrimination in benefits

The legislation will additionally prohibit landlords from universally rejecting tenants who are on benefits or have children.

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Shelter reports that 20% of families in England have struggled to find rental housing due to having children.

The English Private Landlord Survey, which examined the timeframe from 2021 to 2022, revealed that approximately 109,000 households, or one in 10 private renters, were denied tenancy due to their reliance on benefits.

Legal precedents have established that certain instances violated the Equality Act, but the upcoming legislation will clearly prohibit such discriminatory practices to guarantee equal housing opportunities for everyone.

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