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It remains to be seen what potential knock-on effects the new legislation could have on the private rented sector, with added pressures on landlords and a risk of unintended consequences for renters.
The Renters’ Rights Bill seeks to abolish fixed term assured tenancies and assured shorthold tenancies. It will also impose obligations on landlords and others in relation to rented homes and temporary and supported accommodation.
Committee stage is a thorough examination of the individual parts (clauses) of the bill. Starting from the front of the bill, members work through the clauses in order, considering changes (amendments) to the wording or proposals for new clauses.
Four days of committee stage have been scheduled so far:
Tuesday 22 April
Thursday 24 April
Monday 28 April
Tuesday 6 May*
(*schedule is subject to change)
Members speaking on day one of committee stage have put forward amendments (changes) to the bill on subjects including:
two month notice periods
fixed tenancies for students
voluntary extension agreements.
Oli Sherlock of the Goodlord Group commented: “This Bill is ostensibly an attempt to make life easier and more secure for ordinary renters. However, with concerns mounting over the impact these changes could have on tenants, significant questions remain about the potential harm this legislation could do to the very people it’s intended to protect.”
He pointed to a number of measures outlined in the Bill which could have negative consequences for renters.
He said: “The ban on bidding wars could unintentionally cause a rapid increase in average rent prices as soon as the new legislation comes into effect. With landlords forced to accept no more than the advertised rent, many will understandably be tempted to up their prices from the off.
“When it comes to Section 21, there is a real risk that removing this power from landlords may lead to more rental disputes going to court. This could see thousands more tenants receiving County Court Judgements (CCJs) for issues such as rent arrears – damaging their credit scores and potentially restricting their access to properties further down the line.
“The extension of the notice period in the event of arrears (increasing from two months to three months) may seem favorable for tenants but the reality is that by the time tenants are in two months arrears it is often hard to reverse their position. Adding a further month to this process will inevitably lead to larger personal debt. Such measures should be focusing on speedy resolutions for both parties, not extensions.”
Most alarmingly, Sherlock fears that the new legislation could trigger an “exodus” among landlords, reducing the supply of affordable housing: “With the increased pressure of these changes coming on top of the potential costs of complying with measures such as new Energy Performance Certificate requirements, there’s a danger this Bill will be the straw that breaks the camel’s back for many across the sector. Without serious action to address these concerns, we could see a landlord exodus when the new rules are introduced.
“If that happens, the supply of affordable housing will be reduced and rents will only increase, further exacerbating the problems faced by tenants.”
Timothy Douglas, head of policy and campaigns at Propertymark, is urging the UK government to listen to Peers and act on amendments to the Renters’ Rights Bill “to strike a fair and workable balance for letting agents, landlords and tenants”.
He added: “It is positive to see amendments which Propertymark have campaigned on included within the proposed new legislation, such as mandatory qualifications for letting agents, retaining fixed term tenancies as an option, court capacity for when no fault evictions are abolished and extending the deposit cap for renting with pets. It’s also vital that measures to register short term lets come in alongside these regulations to level the playing field.
“It remains imperative there is adequate support for landlords to plan and implement all necessary changes, and that all new legalisation is kept under full review ensuring it remains relevant, evidence-based and fit for purpose moving forwards.”
‘Upwards pressure on rents is likely to intensify as landlords leave the sector’
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