Renters (Reform) Bill: Are tenants being given more power to challenge rent rises? - Total Landlord Insurance

October 31, 2023
Renters (Reform) Bill: Are tenants being given more power to challenge rent rises? - Total Landlord Insurance

Note: Articles on the Renters (Reform) Bill will be continuously updated as details emerge

Article updated 31 October 2023

Read an interactive and user-friendly version of this guide below.

The Renters (Reform) Bill includes plans to end the use of rent review clauses, “preventing tenants being locked into automatic rent increases that are vague or may not reflect changes in the market price." It also states that attempts to evict tenants “through unjustifiable rent increases are unacceptable."

There are a small but significant number of landlords who ask their tenants to shoulder large rises in rent which both campaigners, landlord groups and the Government agree, is wrong.

The question is, how to stop it. While rent controls have been rejected by both the main political parties in England and Wales, Scotland is currently trying out a rent rise cap, which for the foreseeable future will prevent landlords from raising rents by more than three per cent in most circumstances.

The A fairer private rented sector white paper was clear on the Government’s position:

“We do not support the introduction of rent controls to set the level of rent at the outset of a tenancy. Historical evidence suggests that this would discourage investment in the sector and would lead to declining property standards as a result, which would not help landlords or tenants.”

Consequently, the renting reforms as they stand are much tamer than Scotland’s approach; instead stipulating that landlords can only raise their rent once a year, by issuing a section 13 notice, making sure landlords give two months’ notice of a rise, and banning ‘rolling rent increases’ from being written into tenancy contracts.

Currently, if a tenant disagrees with a rent rise, then they must engage with a time-consuming and lengthy battle via a property tribunal which, the figures show, very few tenants bother to use.

The Bill states that in cases where increases are disproportionate, the Government will

"make sure that tenants have the confidence to challenge unjustified rent increases through the First-tier Tribunal" and it will "prevent the Tribunal increasing rent beyond the amount landlords initially asked for when they proposed a rent increase".

The Government wants to make this First Tier Property Tribunal process easier for tenants to access mainly via digitisation. But this has been criticised because it does not come with additional funding for the tribunal system, which will be unlikely to cope adequately with a sudden increase in tenants challenging rent increases.

A parliamentary housing committee recently noted that pushing more tenants towards tribunals would ‘swamp’ the system, saying that:

“It is not clear whether the Government fully appreciates the extent to which an unreformed courts system could undermine its tenancy reforms.”

This is one of the issues in the Bill that will need to be ‘ironed out’. It also noted that the improvement to the tribunals system to enable tenants to challenge rent increases was not about affordability, but in order to stop some unscrupulous landlords using rent increases as a ‘back door’ Section 21 eviction.

For more insights on the Renters (Reform) Bill, listen to a special episode of The Property Cast with Sean Hooker, Head of Redress at the Property Redress Scheme, and leading property expert Kate Faulkner OBE, who share their initial reactions to the Renters (Reform) Bill – will it deliver what tenants need and will it have unintended consequences? Tune in to find out what the experts think.

Keep up to date on the Renters (Reform) Bill

Our media partner, LandlordZONE, offers exclusive insights and breaking news on the private rented sector. Keep up to date with everything you need to know by subscribing to LandlordZONE, the UK’s largest online landlord property news website.

You can also visit Total Landlord's Renters (Reform) Bill hub which will be regularly updated as more details emerge.

Renters (Reform) Bill update: Second reading

Although the Renters (Reform) Bill was introduced to Parliament on 17 May 2023, there was a lengthy delay before the second reading of the Bill, which finally took place on Monday 23 October 2023. It’s predicted that significant changes to the Bill are likely during its next stage as it progresses through Parliament. For a detailed update on the likely changes, head over to our Renters (Reform) Bill hub.

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