Renters (Reform) Bill 2022-23

The Renters (Reform) Bill was introduced in Parliament on 17 May 2023. It will fulfil the 2019 Conservative manifesto commitment to abolish ‘no fault’ evictions in England. The Government’s plans for reform were set out in the white paper A fairer private rented sector (June 2022) which followed several earlier consultation exercises.

Why is the Government legislating?

Assured shorthold tenancies (ASTs) were introduced by the Housing Act 1988 and became the default tenancy in the private rented sector (PRS) in England and Wales from 28 February 1997.

ASTs offer no long-term security of tenure. Section 21 of the 1988 Act enables private landlords to repossess their properties without having to establish fault on the part of the tenant. It is referred to as the ‘no-fault’ ground for eviction.

Over time, evidence has shown this lack of security has led to tenants feeling unable to enforce their rights in relation to repairs and to challenge unreasonable rent increases. The foreword to A fairer private rented sector says “far too many renters are living in damp, dangerous, cold homes, powerless to put things right, and with the threat of sudden eviction hanging over them.”

Local housing authorities argue no fault evictions increase the likelihood of homelessness. Landlord bodies dispute this. They say homeless applications from people living in the sector are linked more closely to rent arrears caused by welfare reform, and that landlords use section 21 to avoid lengthy processes and the uncertainty associated with evicting tenants through service of a section 8 notice and establishing a ground for eviction set out in schedule 2 to the Housing Act 1988.  

There’s currently no legal requirement for private landlords in England to belong to a redress scheme. Tenants are often left to negotiate with their landlords and enforce their rights through the courts.

Although local authorities have extensive powers to tackle poor property conditions and management standards in the PRS, there’s evidence of low and inconsistent levels of enforcement between authorities. A lack of robust data and information on the sector is recognised as a key barrier to effective enforcement action.

What would the Bill do?

• It would abolish assured shorthold tenancies and with them, section 21 ‘no fault’ evictions. Instead, PRS tenancies will be monthly periodic assured tenancies with no end date.
• The grounds on which landlords can seek to repossess properties would be amended and strengthened. The aim is to make it easier for landlords to repossess properties where tenants exhibit anti-social behaviour or repeatedly build up rent arrears.
• A process would be introduced for implementing annual rent increases. First-Tier Tribunals would determine market rents if a tenant appeals against a landlord’s proposed increase.
• A new independent Ombudsman would be established for the PRS.
• A new PRS Property Portal would be established so tenants, landlords and local councils can access the information.One aim of the portal is to help local authorities target enforcement activity where it is most needed.
• Landlords would be required to consider tenants’ requests to keep a pet. They would not be able to refuse such a request unreasonably. Landlords would be able to require pet insurance to cover related property damage.

The Department for Levelling Up, Housing and Communities (DLUHC) has published a series of guides to different parts of the Bill.

An Impact Assessment has been submitted for review by the Regulatory Policy Committee and will be published in due course.

Reaction to the Bill

Broadly, tenant organisations welcome the abolition of ‘no fault’ evictions while landlord bodies initially opposed it. More recently, the National Residential Landlords Association (NRLA) and others have focused on changes landlords require to retain confidence under the new regime. This includes:

• Reformed grounds for possession.
• Improved dispute resolution. There’s some support for a housing court or tribunal among landlord bodies. Improvements to court processes to speed up consideration of claims for possession are regarded as key.
• A review of enforcement.

Landlords are focused on the speed and efficiency with which courts process possession claims. The Bill does not address this but there is a commitment to “align the abolition of section 21 and new possession grounds with court improvements.”

Tenant bodies are concerned that giving a landlord a right to repossess if they want to sell or occupy the property amounts to creating new ‘no fault’ eviction grounds. They argue the evidence thresholds and protections offered in the Bill are insufficient and need to be strengthened if the ambition of creating a fairer PRS is to be achieved.

The provisions to establish a single Ombudsman for the PRS and to require all private landlords to join have been broadly welcomed by stakeholders, as has the establishment of the Property Portal.

Enforcement measures are viewed as important by all stakeholders. The housing charity Shelter and others are calling for adequate funding so local authorities can carry out effective enforcement.

Measures not in the Bill

A fairer private rented sector included several legislative commitments not included in the Bill. The Secretary of State at the DLUHC, Michael Gove, said these measures will be legislated for “in this Parliament”, including:

• A statutory decent home standard to apply in the PRS.
• Making it illegal for landlords and agents to have blanket bans on renting to tenants in receipt of benefits or with children.
• Strengthening councils’ enforcement powers and introducing a requirement on them to report on enforcement activity.