Renters Rights Bill

Labour is expected to introduce the Renters Rights Bill, a significant piece of legislation aimed at reforming the private rental sector. The bill, which follows the former government’s Renters Reform Bill, seeks to strengthen tenant protections and improve living standards in privately rented homes.

One of the key elements of the proposed legislation is the ban on Section 21 no-fault evictions, which would prevent landlords from evicting tenants without providing a reason. This move is designed to give renters greater security and stability, as it is often cited that Section 21 evictions disproportionately impact vulnerable tenants.

In addition, the bill aims to extend Awaab’s Law into the private rented sector, making it illegal for landlords to impose blanket bans on tenants with children or those receiving benefits. This would address a long-standing issue in the rental market, where many families and low-income renters struggle to find suitable accommodation due to discriminatory policies.

A further provision of the bill includes the application of the Decent Homes Standard to the private rented sector for the first time. Currently, around 21% of privately rented homes are considered non-decent, with over 500,000 properties containing serious hazards. Under the new rules, landlords would be required to meet clear expectations for safe, well-maintained, and secure housing. Landlords who fail to comply could face fines of up to £7,000, and persistent non-compliance could lead to prosecution by local councils.

The ban on in-contract rent increases is another notable feature of the bill. If passed, landlords would no longer be able to raise rents mid-tenancy, and rent hikes would be limited to once a year and restricted to market rates. Additionally, rental bidding wars would be outlawed, with landlords and letting agents required to publish an asking rent and prohibited from accepting offers above that amount. These measures are intended to prevent exploitation in the rental market, where tenants are often pressured into paying more than the advertised rate in competitive housing areas.

To ensure compliance with the new regulations, the bill proposes the creation of a Private Rented Sector Database. This database would serve as a resource for landlords, helping them understand their obligations, while also empowering tenants with the information they need to make informed decisions. Local councils would also use the database to identify areas where enforcement is most needed.

Industry Reactions

While the proposed bill has been welcomed by tenant advocacy groups, it has sparked concerns within the property industry. Guy Gittins, CEO of Foxtons, emphasised the importance of tenant welfare but warned that the reforms could have unintended consequences. He pointed out that previous attempts to regulate the rental market, such as increased buy-to-let restrictions, have deterred landlords from investing in the sector. This, he argues, has reduced the availability of quality rental stock, driving up rents for tenants. Gittins also questioned whether the court system is adequately prepared to handle the expected increase in eviction disputes once Section 21 is abolished and how the government intends to enforce rent control measures effectively.

Marc von Grundherr, Director at Benham and Reeves, offered a more scathing critique, suggesting that the bill is less about solving the housing crisis and more about winning votes from renters. According to von Grundherr, penalising landlords through increased regulation has consistently led to fewer available rental properties and higher rents. He speculated that the bill might be part of a broader strategy to push landlords out of the sector, increasing housing stock for potential buyers and masking the government’s failure to build enough new homes.

As Labour prepares to introduce the Renters Rights Bill, the debate over its impact is likely to intensify. While the reforms aim to provide greater protection for tenants and improve housing standards, many in the property sector warn that they could lead to reduced investment and a tighter rental market, exacerbating the very problems the bill seeks to address.