What does the Renters' Rights Act mean for UK landlords?

This article was originally published by Mortgage Solutions.

With new survey data revealing that a quarter of landlords are still unaware of what the Renters’ Rights Act means for them, now is the time for providers and brokers to play their part in helping demystify the key changes coming into effect and ease any concerns that may arise due to the Act’s implementation.[1] At Gatehouse Bank, we remain confident that the Renters’ Rights Act will bring about positive changes within the market, but acknowledge that some landlords may have a significant amount of work to do as they learn to navigate what is set to be the largest changes to the private rented sector (PRS) in over 30 years.[2]

From the beginning of May, section 21 evictions will be abolished, marking one of the most highly anticipated changes to be introduced by the act. This means that landlords will need to provide a valid reason to gain repossession of their property, such as looking to sell or moving back in themselves, with tenants being entitled to two months’ notice to vacate. However, this does not apply in cases where criminal or anti-social behaviour has been recorded or where parts of the property have been damaged, meaning landlords retain the ability to serve necessary eviction notices and still have protections in place to safeguard their investment. More information on this and the notice periods required are available for further reading on the Government website.

Additionally, all tenancies in England are set to move from a fixed-term model to a periodic model, a measure already commonplace within the Scottish property market. This should create a more balanced and fair relationship dynamic between tenant and landlord and allow for greater flexibility which is often needed if a tenant’s circumstances change unexpectedly. Tenants are, however, still required to provide at least two months’ notice should they wish to leave, giving landlords time to find a suitable replacement and reduce the impact of tenants vacating earlier than anticipated.

Later in the year, the PRS will also see the introduction of the Decent Homes Standard (DHS), a set of requirements to ensure that homes are safe and of a decent quality to live in. As an extension of this, Awaab’s Law will also be introduced to cover privately rented properties as well as social housing, which requires landlords to address hazards such as damp and mould within a specified time frame. Both changes are designed to ensure that rental properties are healthy and safe for tenants to live in and can only be a positive step for improving living conditions for renters across England.

Ultimately, while there are several impending changes and it is crucial for landlords to be made aware of the actions they should take, it is equally important to remember that the purpose of the act is to provider renters with greater security and stability, something that landlords can greatly benefit from as well. Landlords who are already providing well-maintained and safe rental properties to tenants should have nothing to worry about or have to make any major changes to their rental portfolio to comply. Instead, the act will simply raise property standards to ensure a more standardised and fair experience where tenants can feel at home wherever they choose to live.

The above provides a summary of our view of the essential changes but landlords are encouraged to seek legal advice about their individual circumstances and how the change affects them.

[1] Pegasus Insight research covered by Mortgage Solutions, A quarter of landlords are still unaware of the implications of the Renters’ Rights Act, but understanding of the legislation is growing among the sector, a survey has found

[2] BBC News, Renters’ Rights Act: Here’s what is means for you