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Landlords – How to Prepare for Renters Reform Post-Election

5 days ago
Landlords – How to Prepare for Renters Reform Post-Election

The Renters (Reform) Bill was a proposed new law that would have
meant some big changes for landlords – with new rules on tenancies, possession
grounds and evictions. With the general election coming on 4 July, let’s take a
look at what this could mean for the reform of rental law going forward.

 

Renters Reform – where we
are now

 

The new Bill made pretty erratic progress after it was announced
in Parliament in May 2023. MPs discussed it at length and made amendments. At
times, it looked like it might even be axed. But it eventually passed all of its
stages in the House of Commons.

 

As of this week, the Bill was going through the same process
in the House of Lords. If the general election hadn’t been called, it could
then have gone on to receive Royal Assent.

 

Will Renters Reform still become
law?

 

This all comes down to who wins the general election!

 

Should the Conservatives win the election, they could carry
the Bill forward into the next Parliament and complete it as planned, with
Royal Assent during the next session.

 

It’s not a given that a Conservative win would see the Bill
carried over, though. It has been very unpopular with many Conservative MPs, so
it could just be dropped and new rental reform laws considered instead.

 

What would Renters Reform
mean for landlords?

 

The big provisions of the Renters (Reform) Bill were that Assured
Shorthold Tenancies (ASTs) would be replaced by rolling periodic tenancies.
Notice periods would be extended. Section 21 evictions (or no-fault evictions
as they are often known) would be banned.

 

There would be new possession grounds, too. These would include
new, tighter Section 8-type procedures to make it easier to evict tenants if
they break their tenancy. (Although the government suggested the new eviction
procedures wouldn’t come into force until the courts were reformed to cope with
the workload.)

 

Other provisions of Renters Reform included a new mechanism
for rent rises, a new PRS database and portal where landlords and properties would
have to be registered, plus new redress schemes and an ombudsman for
complaints. There would also be new rules for tenants who want pets.

 

What are Labour’s plans
for rental reform?

 

The Labour Party haven’t announced firm plans at the time of
writing. So, it is impossible to say. But all the signs are that a future
Labour government would drastically reform rental laws too.

 

In theory, they could carry the Renters (Reform) Bill
forward and bring it into law. More likely is that they’d want to introduce
their own laws.

 

Last week, a Labour Party-linked organisation, The Private
Rented Sector Commission, published an Independent
Review of the UK’s Private Rented Housing Sector
. Although this is NOT official
Labour policy (yet!), it might offer a few clues as to what they might do.

 

Many of the review’s proposals are similar to those in the
Renters (Reform) Bill. The review proposes a new National Landlords Register that
landlords would have to join, a new landlords’ code of conduct and a new
renters’ charter. It proposes more secure tenancies and what are called rent
stabilisation measures. It proposes a new Decent Homes Standard for the private
rented sector and tougher enforcement of standards.

 

Last year, Shadow Levelling Up Secretary Angela Rayner
announced that no-fault evictions would be banned on the first day Labour came into
power.

 

Remember, whoever wins on 4 July, MPs take their summer hols
from the last week of July until the early autumn. So nothing much is likely to
happen over the summer.

 

How landlords can prepare
for the reform of rental laws

 

Many people think any reform of rental laws will make things
a bit tougher for landlords. But then again, demand for rented accommodation is
really good right now and rents are strong. Most experts are forecasting house
prices will go up in the long term too.

 

So right now is something of a watershed moment for
landlords – it’s time to decide whether you want to stay in the lettings
business or perhaps bow out gracefully.

 

You’ll need to consider your own financial situation, of
course. But a good letting agent can give you advice on the local market,
demand, rent trends and prices and maybe offer you some tips on how to maximise
the returns from your property.

 

If you’re staying in the rental market, now is also the time
to prepare for if, how and when rental laws are reformed.

 

Paramount here is to make sure that you attract and keep the
very best tenants. Be especially mindful when signing up new tenants. Remember,
they could have much stronger tenancy rights in future. Also, ensure that your
rents are set at the right level now, just in case it’s more difficult to
increase them in future.

 

This is another good reason for taking advice from a good
letting agent.

 

We can help you find great tenants at the best rents and keep
your rental property performing well no matter what 4 July brings.

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