Renters Reform Bill Could ‘Decimate’ Student Market
On 17 May, the Renters Reform Bill was introduced to parliament. It set out proposals that will – if they’re approved – result in significant changes being made to the legislation surrounding rental properties in England.
But although most people have welcomed the suggested reforms , there have been concerns raised by landlords and some MPs about the impact the bill could have on the student housing market. Particularly, the proposal to remove fixed-term contracts.
Landlords warn of “chaos” if fixed-term contracts are banned
Typically landlords will rent properties out to students in line with the academic year. This can prevent properties from being left empty over the summer months when students often return home.
But under the Renters Reform Bill, students would pay on a rolling weekly or monthly basis, with no fixed end date for the contract. This means that students will have more power to decide how long they stay in the property.
The National Residential Landlords Association (NLRA) has warned that this change could lead to “chaos” as landlords will be reliant on their current tenants giving sufficient notice of their moving out, so that a new group of students can move in in the new academic year.
Labour MP Clive Betts, who chairs the Commons Housing Committee, shares these concerns. He has argued that the changes could lead to landlords leaving the student rental sector, which could result in a further shortage of student housing.
The Renters Reform Bill has not yet been debated by MPs and peers and it’s anticipated that it will face challenges before being passed into law.
According to the Daily Telegraph, the government is already looking at how the bill could be amended to allow landlords to continue renting to students on a yearly basis. But there are concerns that making this exception could lead to students being taken advantage of.
Students will become an “underclass” if exempt from reforms
Despite fears that the new bill could lead to uncertainty and shortages within the student rental sector, the National Union of Students has largely embraced the proposed reforms.
They’ve argued that under the current system, students are often forced to pay for rooms they’re not using over the holidays (if the contract is not in line with the academic year), or if they leave their course early.
They went on to say that exempting students from the new reforms would create an “underclass of tenants”, who would not benefit from the same safeguards as other renters.
This line of thought is supported by Dan Wilson Craw, the acting director of campaign group Generation Rent, who fears that students being treated differently could encourage “unscrupulous landlords” to “take advantage of looser rules” in this market.
Main changes set out in the Renters Reform Bill
As well as abolishing fixed-term contracts, the Renters Reform Bill has made proposals including:
- An end to section 21 ‘no fault’ evictions
This will provide more security for tenants and give them the power to challenge poor practice and unfair rent increases without the fear of eviction. - More thorough possession grounds
Landlords will still be able to recover their property if they’d like to sell it or move family in. It will also be made easier for landlords to repossess property if tenants are at fault. - Stronger protection against backdoor evictions
Ensuring tenants are able to appeal against above-market rent prices that are intended to force them out. - Introduction of a Private Rented Sector Ombudsman
Providing fair, impartial and binding resolution to potential issues – offering a quicker and cheaper process than going through the court system. - Creation of Privately Rented Property Portal
This will help landlords to understand their legal obligations and demonstrate compliance. It will also provide better information for tenants to make informed decisions when entering into a tenancy agreement. - Giving tenants the right to request a pet in the property
Landlords will have to consider requests to have a pet in their property and they cannot unreasonably refuse. As an additional support, landlords will be able to require that pet insurance is taken out to cover any damage to the property.
Why has the new bill been introduced?
In their guide to the Renters Reform Bill, the government has set out three key reasons for the introduction of new reforms. These include:
- Lacking security for renters
Since 2004, the overall number of privately rented properties has doubled. But many tenants are still facing a lack of security. This can make it difficult to put down roots in one area and hold on to stable employment. - Dangerous housing
Nearly a quarter of private rented homes do not meet basic decency standards. One of the main hazards faced by tenants is the presence of damp and mould which can lead to respiratory illnesses if it is not addressed. - Challenges faced by responsible landlords
Some landlords face difficulties when evicting tenants who deliberately refuse to pay their rent or display anti-social behaviour. They are also at risk of being undercut by a ‘minority’ of criminal landlords. The reforms aim to celebrate responsible landlords and given them peace of mind that property can be repossessed if a tenant is behaving badly.
It’s a positive sign that the government is taking steps to improve the private rental market. But we’re yet to see what impact this will have or how long it will take for changes to be made.
If you’re currently going through a dispute as a landlord or tenant of a private rented property, we could help you reach a resolution. We work with solicitors who are experienced in this area and they could give you the support you need.
To find out more, give us a call or start your enquiry online.
