Changes to residential tenancies

On 17 May 2023 the government introduced a new Bill which, if passed in its current form, will overhaul the private rented sector in England – impacting 11 m tenants and 2.3 m landlords. The Bill will make sweeping changes including the headline proposal of banning “no-fault” evictions under section 21 of the Housing Act 1988 – delivering a 2019 Conservative manifesto pledge. This provision currently allows a landlord to serve two months’ notice to terminate a tenancy once a fixed-term tenancy has expired, or at any point during a periodic tenancy.

Under the new legislation fixed-term tenancies will be abolished and all terms will be periodic – meaning they do not have a set end date. Renters will be able to stay in their homes until they give notice to leave or the landlord can prove a relevant ground for possession. Landlords will be able to evict anti-social tenants and those who consecutively fall into arrears. In addition there will be mandatory grounds for possession where the landlord (or their close family member) wishes to move into the property, sell or redevelop – all after two months’ notice. Theses grounds will not be able to be used within the first six months of a tenancy.

Moreover, the reforms will see a statutory regime for notifying tenants of a new rent increase – such rises to occur no more than once every twelve months. A prescribed form will have to be used and if the tenant does not accept the increase, then they can dispute it at the First-tier Tribunal.

There will be a staggered implementation of the changes mentioned above. After Royal Assent has been received for the Bill, at least six months’ notice will be given before new tenancies are subject to the rules. Existing tenancies will also begin following the new rules on a date not less than 12 months after the first implementation date.

The Bill also introduces a Private Rented Sector Ombudsman with the power to issue “fair, impartial and binding resolutions” in a much more expedient and less adversarial manner than via the courts. Participation by private landlords will be mandatory. The Ombudsman will have the power to require an apology, remedial action and issue awards of compensation up to £25,000. The aim is to increase transparency for all parties.

Finally, the Bill will require landlords to consider a tenant’s request to keep a pet at their property and not refuse the same unreasonably. In exchange for this, landlords will be able to require tenants to insure against damage caused by a pet.

The Bill is currently at its second reading stage in the House of Commons so further changes to the above may follow. We will keep you updated in this regard.