The NRLA update student landlords on the Renters' Reform bill and what it will mean for student landlords. The NRLA also outline their strategy for influencing the bill to ensure it is workable for student landlords.
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The Renters' Reform BIll: What it means for student landlords
1. The Renters (Reform) Bill:
What it means for student landlords
Ellie Bateman, Senior Campaigns and Public Affairs Officer
22 June 2023
www.nrla.org.uk
2. Overview
1. Increased ‘Security’ & ‘More Stability’
- Abolition of S21
- Open ended tenancies
- Two months’ notice to end a tenancy (tenants)
- Written statements
2. New Grounds for Possession
- Mandatory grounds for selling, moving in or repeated rent arrears
- Expansion of discretionary ASB ground
3. Improved Dispute Resolution
- Rent Increases and First Tier Tribunal
- PRS Property Ombudsman / Mandatory for Landlords
4. Better Compliance
- PRS Property Portal / Mandatory for Landlords
5. A Positive Renting Experience
- Legal right to request pets
3. • The Bill is in its early stages of the legislative process.
Landlords should not panic yet.
• It is unlikely that the Bill would receive royal assent this
year. Spring 2024 is a more realistic timeframe.
• Even when the Bill does become an Act of parliament, the
SoS must set the dates for when different parts of the
legislation will apply.
• It’s expected that most of the Bill will apply to new
tenancies six months after the Act becomes law.
• 18 months after the Bill becomes law, most of the
legislation should apply to pre-existing tenancies too.
When will it apply?
4. • The Bill will abolish S21 ‘no fault’ evictions and move to a
tenancy structure where PRS tenancies are open-ended
(periodic).
• All evictions will need to be based on approved reasons
under S8 of the Housing Act 1988. These can be
mandatory or discretionary grounds.
• There will be no fixed terms for assured tenancies and
tenants will be able to give two months’ notice to leave a
property at any time.
• No exemption from this regime exists for off-street student
landlords.
Section 21 & End to
ASTs
5. • NRLA is focused on ensuring grounds for possession are
workable and provide confidence to landlords.
• Of note are mandatory grounds for possession where:
• A landlord intends to move in (including close family) or sell, with a
notice period of 2 months. Landlords will not be able to use these
grounds in the first 6 months of a new tenancy.
• Repeated rent arrears, where a tenant has been in at least two
months’ rent arrears three times within the previous three years,
with a notice period of 4 weeks.
• However, the Bill increases the notice period for the existing rent
arrears ground to four weeks.
• The Bill would amend the discretionary ASB eviction
ground to clarify that any behaviour 'capable of' causing
nuisance or annoyance can lead to eviction.
New Grounds for
Possession
6. • Details on this are not in the Bill.
• The SoS has confirmed that they will ‘align the abolition of
S.21 and new possession grounds with improvements to
the court system’.
• This includes end-to-end digitisation of the process and
our work with the courts to explore the prioritisation of
certain cases, including antisocial behaviour.
• The Policy and Campaigns Teams will be making the
case that court reform must be in place before S.21 is
removed.
Court Reform
7. • The Government intends that all landlords who rent out
property will be required to join a property
ombudsman/redress scheme, regardless of whether they
use an agent.
• Landlords will not be able to market a property unless
they are a member.
• The ombudsman will deal with complaints from current,
former and prospective tenants.
• Local authorities will be able to take enforcement action
against landlords that fail to join the approved scheme.
Landlord Redress
8. • The Bill would give SoS the powers to create a ‘Private
Rented Sector Database’, supporting the new digital
Property Portal Service, which all landlords who rent out
properties will be required to register on.
• This is set to replace the existing ‘Database of Rogue
Landlords and Property Agents’.
• Entries into the database will contain:
• Existing or prospective landlords
• Dwellings which are or intend to be let
• Banning orders, financial penalties, regulatory breaches
• Local Authorities will be able to access this database and
take enforcement action against landlords who do not
meet their obligations to register their properties.
Property Portal
9. • The Bill requires landlords not to unreasonably withhold
consent when a tenant requests to have a pet in their
home.
• It also introduces a term to all contracts that the landlord
must respond to requests for pets within 42 days , which
can be extended where tenants and landlords agree.
• Landlords will be given additional time to respond where
they have requested further information, for example
requesting consent from a superior landlord.
• Where consent has been provided, landlords will be able
to require pet insurance or charge the tenant for the cost
of taking it out themselves.
Pets
10. Impact on student landlords
• The Bill will abolish Assured Shorthold Tenancies (ASTs) and
fixed terms.
• Tenancies open-ended until a tenant serves two months’ notice
(at any time) or landlord ends tenancy using a Section 8 notice.
• Currently no ground to ensure a property is available for
incoming students the following academic year.
• PBSA is unaffected by the changes to ASTs/fixed terms.
• Where students were to leave a property midway through the
academic year and new students could not be found to move
in to replace them, landlords may face difficult decisions.
11. Student Lets in the PRS: Our
Proposals
A mandatory, prior notice, ground for possession for off-
street student housing.
• Require landlords to inform the tenant in writing, before the start
of the tenancy, that they might need to regain possession
• Two months’ notice where a property is needed by an incoming
student(s).
• Can only be used where a landlord has, in the preceding twelve
months, let the property to students registered with an education
institution.
• Applicable where non-students lived in the property during this
twelve-month period. For example, where one or more of the
original students had left university or had assigned their rights to
a non-student during the academic year.
The Bill must be amended to include a moratorium on
tenants serving notice.
• A four-month period from first occupation, which tenants may not
12. Student Lets in the PRS: Our
Progress
Engagement with Government
• Meetings with the Secretary of State, Housing Minister
and Government officials.
• Participation on Government roundtables.
• Joint letters to the Housing Minister setting out our
recommendations.
Working with industry stakeholders
13. • Despite being included in the Rental Reform White Paper,
the Bill does not provide any further detail or clarification
on how the following proposals will be implemented:
• Applying the Decent Homes Standard for the PRS.
• Making it illegal for landlords and agents to have blanket bans on
renting to parents with children or those in receipt of benefits.
• The new requirement for councils to report on enforcement activity.
• Government has confirmed that it is “considering how to
implement these policies” and “will bring forward legislation at
legislation at the earliest opportunity to apply the Decent Homes
Homes Standard in the private rented sector”.
Missing Elements
14. Our Renters (Reform) Bill
Hub
• Access more information about the Renters (Reform) Bill on the
NRLA's rental reform hub. It provides:
• A summary of the Bill and its key provisions
• FAQs
• Updates on the progress of the Bill
• Information on webinars and events
• Scan the QR code on the slide to access the hub.
• Stay up to date on the progress of the Renters (Reform) Bill and
developments relating to it through our e-news, monthly
bulletins and social media.
Increased Security and More Stability:
Section 21
The Bill will abolish S21 ‘no cause’ evictions and move to a tenancy structure where are PRS tenancies are periodic.
All evictions will need to be based on approved reasons provided by a landlord under S8 of the Housing Act 1988.
End to ASTs
The Bill removes ASTs, so most future tenancies will be assured periodic tenancies.
There will be no fixed terms for assured tenancies and tenants will be able to give two months’ notice to leave a property at any time.
NO exemption from the periodic tenancy regime for PRS student landlords.
Written Statements
The Bill will require landlords to provide a written statement of their contract terms to the tenants.
The statement will set out basic information about the tenancy and both parties’ responsibilities and the terms required by regulation. This may be added to by further regulations.
We will be using the experience in Wales to try and ensure that this is as painless as possible for landlords.
New Grounds for Possession:
S8 grounds for possession are likely to be altered significantly by the Bill.
Of note, this includes mandatory grounds for possession where:
A landlord intends to move in (includes close family) or sell, with a notice period of 2 months. These grounds will not be available to be used in the first 6 months of a new tenancy.
Repeated rent arrears, where a tenant has been in at least two months’ rent arrears three times within the previous three years, with a notice period of 4 weeks.
However, the Bill increases the notice period for the existing rent arrears ground to four weeks.
It expands the discretionary ASB eviction ground to clarify that any behaviour capable of causing ‘nuisance’ or ‘annoyance’ can lead to eviction.
Improve Dispute Resolution:
Rent Increases
Landlords will be able to raise rents annually to align with market rent - a Section 13 notice must be used to do this.
Tenants will be able to challenge ‘above-market’ rent increases through the First-tier Tribunal (Property Chamber), which will assess the proposed increase against prices on the open market.
The notice period for a rent increase will increase from a minimum of one month to two months before the new rent takes effect.
Should it be determined that the rent increase is ‘above market’ levels, the landlord and tenant can agree in writing to a lower rent.
PRS Ombudsman
The Government intends that all landlords who rent out property will be required to join a property ombudsman/redress scheme, regardless of whether they use an agent.
Landlords will not be able to market a property unless they are a member.
The ombudsman will deal with complaints from current, former and prospective tenants.
Local authorities will be able to take enforcement action against landlords that fail to join the approved scheme.
Better Compliance:
The Bill will give the SoS power to create a ‘Private Rented Sector Database’, supporting the new digital Property Portal Service, which all landlords who rent out will be required to register their properties on.
This is set to replace the existing ‘Database of Rogue Landlords and Property Agents’.
Entries into the database will contain:
Existing or prospective landlords
Dwellings which are or intend to be let
Banning orders, financial penalties, regulatory breaches
Local authorities will be able to access this database and take enforcement action against landlords who do not meet their obligations to register their properties.
A Positive Renting Experience:
The Bill requires landlords not to unreasonably withhold consent when a tenant requests to have a pet in their home.
It also introduces a term to all contracts that the landlord must respond to requests for pets within a reasonable timeframe (normally 42 days).
Landlords will be given additional time to respond where they have requested more information.
In instances where consent has been provided, landlords will be able to require pet insurance or charge the tenant for the cost of taking it out themselves.
The Bill should be revised to include a mandatory, prior notice, ground for possession for on-street student housing:
The ground would require landlords to inform the tenant in writing, before the start of the tenancy, that they might need to regain possession in the future.
This provision should require two months’ notice where a property is needed by an incoming student(s) and could be served no earlier than the 1st June following commencement of a tenancy and no later than the tenth month after the students occupied the property.
This ground can only be used where a landlord has, in the preceding twelve months, let the property exclusively to students registered with an educational institution.
The Bill must be amended to include a moratorium on tenants serving notice:
We recommend a four-month period from first occupation, during which tenants may not serve notice unilaterally, mirroring the current restrictions on landlords’ ability to end a tenancy.
Upon expiry, two months’ notice can be given at any time by a tenant.
This would provide a more appropriate balance between flexibility for tenants and security for landlords. Implementing this measure would lessen the risk of void periods, protect landlords from re-letting costs, and help to retain investment in the private rented sector.
This would not limit parties’ ability to negotiate a surrender of the tenancy or interfere with any other rights concerning unsuitable accommodation or breach of tenancy obligations.
The Bill should be revised to include a mandatory, prior notice, ground for possession for on-street student housing:
The ground would require landlords to inform the tenant in writing, before the start of the tenancy, that they might need to regain possession in the future.
This provision should require two months’ notice where a property is needed by an incoming student(s) and could be served no earlier than the 1st June following commencement of a tenancy and no later than the tenth month after the students occupied the property.
This ground can only be used where a landlord has, in the preceding twelve months, let the property exclusively to students registered with an educational institution.
The Bill must be amended to include a moratorium on tenants serving notice:
We recommend a four-month period from first occupation, during which tenants may not serve notice unilaterally, mirroring the current restrictions on landlords’ ability to end a tenancy.
Upon expiry, two months’ notice can be given at any time by a tenant.
This would provide a more appropriate balance between flexibility for tenants and security for landlords. Implementing this measure would lessen the risk of void periods, protect landlords from re-letting costs, and help to retain investment in the private rented sector.
This would not limit parties’ ability to negotiate a surrender of the tenancy or interfere with any other rights concerning unsuitable accommodation or breach of tenancy obligations.