Property Geek weekly roundup

May 21, 2023

This is a huge week for property, with the biggest legal change in a generation finally coming before parliament. So this week, I’ve dropped all the other news and will focus on telling you everything you need to know...

The biggest landlord changes in a generation have begun

This is not a drill! After countless false starts, fake-outs and foot-drags, the Renters (Reform) Bill started its journey through parliament yesterday.

This means that after literally five years of rumour and speculation, we know for sure what changes the government intends to make. And they are... not small.

On a grammatical level, the bill gets a big thumbs-up from me for putting “reform” in brackets so I don’t have to worry about where to put an apostrophe. But most people will probably be more interested in the contents, so let’s dive into a summary...

1: No more no-fault evictions

And more than that: all tenancies will now be issued on a rolling month-to-month basis from the start. Tenants only need to give two months’ notice to end it - which they can do on the same day as moving in if they want to, which seems crazy to me.

You’ll still be able to ask tenants to leave:

  • To sell a property or move in, other than during the first six months
  • In the case of persistent rent arrears, or more than eight weeks’ worth building up

If they refuse to leave, you’ll need to apply to the court for possession - and the government is promising an “aligned” digitisation and prioritisation of the courts system to speed this up. We will see…

2: Ability to challenge rent increases

Rent increases can be proposed once per year, with two months’ notice being given.

If a tenant believes an increase is above the market rate, they can ask a tribunal to adjudicate.

3: A mandatory redress scheme

All landlords will need to sign up to a new scheme - and pay for it - which tenants can then use to complain about you. Can you use it to complain about your tenants? Of course not.

4: A landlord database

I haven’t looked at this one much, but it seems that there will be a national database that the landlord and property must appear on before it’s let. The idea seems to be that it will help prospective tenants see if a landlord has had any previous issues before they commit to a tenancy.

5: Yes to pets

You won’t be able to unreasonably withhold consent if a tenant requests to keep a pet, but you can insist on them paying for pet insurance to cover any damage.

When will this happen?

It’s important to know that this is the start of the legislative process, and there are ample opportunities for the bill to be amended - so there could be significant changes yet.

We don’t know when it’ll be finalised, but my best guess is that it will become law early next year. New tenancies will then likely be of the new type six months later, with a further year before existing tenancies are automatically converted.

My view?

There are some truly odd parts to this bill, including some that would offer more protection to tenants without being remotely controversial. I share my thoughts in this video, which is a real must-watch (if I do say so myself).

All in all, is it the end of days for landlords? No. As currently drafted, it does cause significant challenges for student lets - and this is an area that might be amended.

But other than that, there are a few annoyances but nothing that majorly concerns me.

It does, though, make me feel even more strongly about the strategy (which I’ve written about before) of focusing on quality.

Even if court reform is a huge success, it’ll still be harder to remove tenants who don’t pay - so it makes sense to focus on the upper end of the market where you can be more picky about who you take on, and (as a very general rule) the chances of rent arrears or antisocial behaviour are lower.

As I said, this is just the beginning of the process - so stay tuned, and feel free to send any questions to Ask Rob & Rob.

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