Renters’ Rights Act becomes law

This article is a follow up to our recent piece about the Renters Right's Bill in September.

The Renters’ Rights Act became law at the end of October, but the implementation dates for many of its key measures have yet to be set out. Matt Warren, ARAG’s Head of Broker and MGA Sales, takes a look at the legislation and what it means for tenants, landlords and their insurance providers.

It would be hard to argue that the private rental sector in the UK wasn’t in need of some sort of reform. Nonetheless, the Renters’ Rights Act represents the biggest transformation of the legal framework around renting property in decades, so landlords and tenants will need to familiarise themselves with the changes it’s making.

Rental reform reborn

There was a measure of déjà vu about the Renters’ Rights Bill. The legislation had quite a lot in common with the Renters (Reform) Bill introduced to parliament by Michael Gove, back in May 2023, which was left stranded in the House of Lords when last year’s snap election was called.

Both bills aimed to abolish section 21 notices, introduce a ‘decent homes standard’ to improve the quality of rented accommodation and regulate rent increases, but the government’s bill that has now passed into law, went further in giving tenants more certainty.

Fixing fixed terms

One of the most significant changes will be the immediate end of fixed-term tenancies. Once the new law is implemented, all existing fixed-term tenancies will automatically become periodic tenancies. The government has yet to pin down exactly when this will happen, but it is expected to be next Spring.

Alongside the abolition of Section 21 notices, which allowed landlords to serve notice on tenants without giving a reason, this should give renters more control over when the tenancy ends.
Landlords will still be able to regain possession of their property if they need to. In fact, the list of grounds for repossessing a property under Section 8 has been extended. So, if a landlord wants to sell their property or let family move in, they will be able to. Equally, persistent rent arrears and anti-social behaviour from tenants will still provide grounds for eviction.

Better homes, fairly priced

The decent homes standard that should already be met for social housing will also now apply to privately rented properties. This should ensure that rented homes meet minimum standards and that landlords promptly address any problems with damp, mould, heating or the water supply.

In line with the last government’s plans, the Renters’ Rights Act will also limit a landlord’s ability to hike the rent demanded of tenants. In future, rent increases will require a Section 13 notice and be limited to just once per year.

The legislation also aims to stop landlords from exploiting bidding wars to push rents up. While only a minority of landlords are thought to use this tactic, the practice was known to be a problem for renters in several cities including London, Southampton and Brighton.

Major change for landlords

This is just a summary of some of the key measures that the new law, which fulfils a key manifesto pledge for the government, is introducing.

The Renters’ Rights Act should also make things easier for pet owners trying to rent a home; will introduce an ombudsman for the private rental sector; prohibits discrimination against tenants; will create a national database of privately rented properties and strengthen enforcement where the law has been broken.