The Renters Reform Bill: December 2023 Update

The Renters (Reform) Bill has just completed what is known as the committee stage in the House of Commons. In this post we will look at what happened at this key stage in the Bill’s progress, and at what changes have been proposed to the new upcoming law.

A quick recap on the Renters (Reform) Bill

The Renters (Reform) Bill proposes a major change in landlord-tenant law in England. (Some small parts of it will also affect Wales.) Major changes include: Abolishing ASTs and making all tenancies assured periodic tenancies. Reforming grounds for possession including abolishing Section 21 ‘no fault’ evictions. Clarifying grounds for eviction following anti social behaviour. A new system for regulating rent rises. Introducing a PRS property portal and database. Clarifying the legal duties of landlords and agents. Introducing new investigatory and enforcement powers.

The Renters (Reform) Bill was published in May 2023 and has since passed through its first and second readings in the House of Commons during which MPs were able to debate its proposals. It has now completed the next stage, the so-called committee stage, which we will look at here.

For more information on the Renters (Reform) Bill check our previous blog posts:

The Renters Reform Bill: What’s In It And What Does It Mean For Landlords?

The Renters Reform Bill: November 2023 Update

What was the purpose of the committee stage

New Bills are examined by what is known as a Public Bill Committee. At this stage a committee of MPs scrutinises the Bill section by section. They also take in opinion from expert witnesses and interested partes. Possible amendments to the new legislation are selected, debated and then voted on.

In the case of the Renters (Reform) Bill the committee took in opinion from charities, tenants’ bodies, landlords’ bodies, industry and public bodies and PRS landlords. These included Shelter, Citizens Advice, the Joseph Rowntree Foundation, Generation Rent, the National Residential Landlords Association, the National Union of Students, Propertymark, the British Property Federation, the Chartered Institute of Environmental Health and Grainger plc.

Following the committee stage the Bill was republished. The latest version can be found here.

What happened at the committee stage?

The Renters (Reform) Bill committee stage considered 270 proposed amendments to the Bill and accepted around 100 of them. The official record of its deliberations ran to almost 250 pages.

In brief, all the major provisions of the Bill made it through the committee stage largely intact subject to these amendments. However, it should be said that a good many of the amendments made were minor, technical details. They were designed to clarify the way the new proposed laws will operate but do not change the overall impact of them.

In the rest of this section we will try to summarise the most important developments at the committee stage.

The abolition of ASTs and introduction of assured periodic tenancies

The introduction of assured periodic tenancies with no fixed term is a key principle of the Renters (Reform) Bill and was confirmed.

A new amendment to ensure tenants are protected from being forced by their landlord to agree in writing a shorter notice period than two months (by requiring a court to authorise such agreements) was not adopted.

The abolition of Section 21 no fault evictions

The committee stage confirmed that the Section 21 eviction process will be abolished. However, the government has said this will not be implemented until the court system is able to cope with the new evictions system – likely by introducing a digital system.

One further proposed amendment made it illegal for landlords and agents to serve notice using a ground for possession on which the landlord is not entitled to rely. Another minor amendment discussed would mean deposits must be protected before a notice for possession is served, rather than before a court hearing.

Changes to the grounds for possession – impact assessment

Changes to the grounds for possession were passed. However it was suggested that the impact of these changes should be reviewed by the government within two years of the Bill receiving Royal Assent.

Anti-social behaviour – a new definition

A new clause places a duty on the government to produce further guidance on what constitutes anti-social behaviour – for the purpose of assisting landlords to determine when this can be used as a basis for eviction.

It also proposed changes to the factors for a court to take into account when considering whether to grant a possession order on the discretionary anti-social behaviour ground of possession. It also proposed that a court will need to consider effects on other tenants of the same HMO where relevant.

Selling a property or using it for family

Under the new law, landlords will be able to take possession of their property if they wish to sell it or move their own family in. However, the committee stage proposed new amendments to tighten up on the possible misuse of this ground, including to prevent letting agents from remarketing these properties for a certain period.

Exceptions for student HMO tenancies

The committee stage introduced an amendment for student HMO tenancies. Landlords of HMOs will be able to regain possession at the end of the academic year – an amendment that benefits student tenants as well as landlords – which the original Bill did not include.

A ban on discriminatory practices

The new law will ban certain discriminatory practices including in advertising. These will cover banning discrimination against prospective tenants who have children (or have children to visit), those with pets or those on benefits. It will still be legal to take a tenant’s income into account however, which will be relevant to prospective tenants on benefits.

Terms in mortgages and property insurance contracts which force landlords to discriminate against certain groups will be rendered unenforceable.

Rent increases

The proposed new system for rent increases was agreed.

A new clause would also require landlords and letting agents to state the proposed rent payable in advertisements for a property.

Statement of terms – duties of landlords and agents

It was proposed that the duty of a landlord to give a statement of terms and other information be extended to include letting agents.

A new Decent Homes Standard

The Renters (Reform) Bill did not originally contain proposals to introduce a Decent Homes Standard in the PRS, although the government had previously committed to it. The latest version of the Bill contains proposals for one – which is described as a ‘new system for assessing housing conditions and enforcing housing standards’. The detail of this is yet to be decided however. The Department for Levelling Up, Housing and Communities (DLUHC) is reported to be working on proposals.

This committee debated, but did not accept, applying the new standard to other types of accommodation such as temporary accommodation for the homeless.

Council Tax – tenant liability

A new clause would make tenants under an assured tenancy continue to be liable for Council Tax until the end of the tenancy even if they vacate the property before it ends.

Homelessness prevention duties

A new amendment proposed maintaining the homelessness prevention duties of local authorities to those who have received a notice to vacate a property and would extend it to notices for possession issued under section 8 of the Housing Act 1988.

Widening of the definition of a landlord

A new amendment proposed extending the definition of residential landlord (and of a dwelling) to include park home operators, private providers of purpose built student accommodation and property guardian companies.

Deposit disputes – the ombudsman

A new amendment will mean that where there is a dispute regarding deposits this can be submitted direct to the ombudsman scheme for redress rather than just to the tenancy deposit schemes.

Proposed increases in penalties

The committee considered increases in the penalties which can be imposed on landlords, such as for not joining the required landlord redress scheme. Penalties of £5,000 would be increased to £30,000. Penalties of £30,000 would be increased to £60,000. The increases were not adopted however.

A further amendment proposed doubling the maximum amount of rent that a landlord might be ordered to repay under a rent repayment order from 12 months to two years rent.

PRS database – increased scope

The Bill proposes the setting up of a PRS database and this was confirmed. A new amendment would have required the database to record details of disputes and notices of possession served by landlords on their properties. This was not adopted.

Rent repayment orders – superior landlords

One significant amendment would make what are known as superior landlords responsible for rent repayment orders. This could affect rent to rent arrangements when issues arise even if they are not within the control or knowledge of the superior landlord (likely to be the property owner). This change could overrule a ruling made in 2023 by the Supreme Court (Rakusen v Jepsen).

Enforcement powers – county councils

One amendment would confer certain enforcement powers on county councils which are not local housing authorities. Also, one local housing authority may be able to enforce in other areas in certain circumstances.

New/revised investigatory powers

The Bill will give local housing authorities new and revised investigatory powers to allow them to investigate and enforce breaches of the law.

These powers will entitle enforcement officers to require information from both relevant and additionally any person where they suspect there has been a breach of the law. They will have powers to enter either without force, or with force if they have a warrant, any premises that are occupied for the purposes of a rental sector business. They will be able to demand and seize relevant documents. Enforcement officers will be able to obtain a warrant to enter any property suspected of being a rental property.

Local housing authorities will be able to use information from tenancy deposit schemes, housing benefit and Council Tax sources to aid enforcement.

Local housing authorities will have new investigatory powers to enforce requirements on property agents to be members of a client money protection scheme.

What will happen with the Renters (Reform) Bill next?

Following the committee stage the Renters (Reform) Bill moves on to what is known as the report stage in the House of Commons. The report stage gives MPs an opportunity, on the floor of the House, to consider further amendments (proposals for change) to a Bill which has been examined in committee. All MPs can suggest amendments to the Bill or new clauses (or parts) they think should be added. All MPs may speak and vote on these.

The report stage is normally followed immediately by debate on the Bill’s third reading.

There is no fixed time period between the end of committee stage and the start of the report stage. It is not known when the report stage will commence at time of writing.

Subsequently the next stage will be for the Bill to complete the same process in the House of Lords.

Summary

After a very slow start in which, at one point, it looked like the Renters (Reform) Bill might fall by the wayside the progress of the proposed new legislation is quickening. As committees go this committee did a pretty efficient and swift job, even finishing a few days earlier than scheduled.

It is now looking a little more likely that a new Renters (Reform) Act could receive Royal Assent and become law before the next General Election comes along and changes the whole political climate. Though, even if it does, that does not mean all its provisions will come into force immediately. Implementation dates for many aspects of the new law will be later, and different for new and existing tenancies.

We all now have a much clearer idea of what the proposed new legislation, which will affect landlords, tenants and everyone in the lettings industry, will be like. However, there is still much work to be done and further significant changes could be made.

After the committee stage the general consensus amongst many landlords and landlords’ organisations still appears to be pessimistic. Many if not most agree it will make their business harder and possibly persuade them to leave the PRS. Tenants’ organisations and campaigners, while welcoming many of the amendments, are hardly celebrating the new proposed law however.