The process of moving in and out can be easily managed when you are prepared, but the Renters’ Rights Bill throws things up in the air for letting agents. While many of its provisions are aimed at helping renters, property managers need to be aware of the significant shifts this legislation will bring. Expected to become law in autumn this year, the changes are far-reaching and will demand a proactive approach to compliance.
Here are three big changes to expect and prepare for when it comes time for tenants to move in and out.
Perhaps the most fundamental change is the abolition of fixed-term assured shorthold tenancies (ASTs). On day one of the Renters' Rights Bill coming into law, all new and existing assured tenancies will become periodic. This means tenancies will roll month-to-month (or weekly, depending on rent payment frequency) with no specified end date.
Tenants will gain the power to give two months' notice to leave at any time, without being tied to the fixed term specified in their original contract. It could lead to higher tenant turnover and shorter tenancy durations, requiring property managers to be more agile in their re-letting strategies.
The How to Rent guide, a document provided to tenants at the start of a tenancy, will undoubtedly be updated to reflect the new legislation. Property managers will be responsible for ensuring they issue the most up-to-date How to Rent guide to all new tenants.
Non-compliance with the new documentation requirements and tenancy terms could lead to fines and legal challenges. Property managers must invest time in understanding and implementing these changes to avoid penalties.
The headline change of the Bill is the scrapping of Section 21 no-fault evictions. Landlords will no longer be able to evict tenants without a specific, legally defined reason. Instead, they will need to rely on the reformed Section 8 grounds for possession.
Property managers will need to be meticulous in documenting any breaches of tenancy agreements, such as rent arrears, anti-social behaviour, or damage to the property, as these will be the only permissible grounds for eviction.
The Bill also introduces new mandatory grounds, such as a landlord intending to sell the property or move in themselves (though tenants will have a 12-month protected period at the start of a tenancy for these grounds). Property managers will need to understand these new grounds and the specific notice periods associated with them (often extended to four months for landlords).
There is potential for longer eviction processes because while the Bill aims to streamline the court process, proving a Section 8 ground can be more complex than a Section 21 notice. This could lead to longer eviction timelines if court action is required.
For property managers, the Renters’ Rights Bill means a period of adaptation and a renewed focus on understanding and adhering to the new legal landscape. By embracing these changes, property managers can ensure they remain compliant, maintain positive relationships with their tenants, and navigate the changing rental market. Staying informed and seeking professional advice will be paramount as the Bill progresses.