Charities: What do you need to know about the Renters Rights Bill?

All assured and assured shorthold tenancies will be abolished, being replaced by monthly periodic “rolling” tenancies (i.e., no fixed end date), which can be ended by the tenant upon serving 2 months’ notice to leave.

Charities have historically relied on the flexibility afforded by section 21 evictions in both their capacity as landlords and beneficiaries of gifts in wills. Section 21 evictions (i.e., landlords giving tenants 2 months’ “no fault” notice to bring an end to their tenancy) will no longer be available to landlords, who will instead need to give notice seeking possession based on prescribed mandatory and discretionary grounds (and apply to court to demonstrate those grounds are satisfied if the tenant does not leave at the end of the notice period).

Mandatory Grounds for Eviction:

The mandatory grounds are only available after the tenancy is over 12 months old (except in cases of serious anti-social behaviour). Full-time students are an exception to the 12-month tenancy rule; those landlords can give 4 months’ notice (i.e. to allow for new students each academic year). The Mandatory Grounds include:

• Selling/redeveloping/landlord occupation – 4 months’ notice to terminate
• Rent arrears (3 months’ arrears minimum) – 4 weeks’ notice to terminate
• Antisocial/criminal behaviour – 2 weeks’ notice to terminate

Discretionary Grounds for Eviction

The Discretionary Grounds include:

• Persistent rent arrears (or rent arrears falling under 3 months) – 4 weeks’ notice to terminate
• Breach of tenancy agreement – 2 weeks’ notice to terminate
• Deterioration in the condition of the property – 2 weeks’ notice to terminate

A new ombudsman scheme will be introduced according to the Bill. All landlords will have to join (and pay a membership fee). Tenants will have a right to complain to the ombudsman but landlords will not currently be able to resolve issues that they are having with tenants through the ombudsman. There are proposals for a landlord-initiated mediation service, as below.

Landlords will be required to register with a database (which will be a useful information tool for tenants and local authorities). They will also be unable to seek possession orders without first registering.

The Bill aims to resolve concerns around pressures on the court system by introducing options for early dispute resolution and landlord-initiated mediation through the new ombudsman scheme.

Landlords will be required to give tenants 2 months’ notice of rent increases, which will be limited to once a year at market rent. Tenancies will not include rent review clauses. Tenants will be able to challenge rent increases in the First Tier Tribunal if they consider they exceed market rent.

There are other notable changes to be introduced by the Bill, including those relating to tenant’s reasonable requests to have a pet in their home (which must not be unreasonable refused), prohibiting landlords’ refusal to house tenants who receive benefits or have children, ensuring that the property meets the Decent Homes Standard (e.g. rectifying mould and damp within a specified period), prohibiting landlords from encouraging or accepting inflationary rental bidding wars, and fines and criminal sanctions for landlords breaching their obligations under the Bill.