Renters Reform Bill Passes Second Reading

The government has given the Renters Reform Bill a second reading in the House of Commons.

What does this mean for buy-to-let landlords? And will your rights as a landlord be affected?

Let’s see how this affects buy-to-let opportunities in 2024.

The second reading serves as the initial opportunity for MPs to discuss the fundamental principles of the Bill. This deliberation typically occurs at least two weekends following the first reading.

During the second reading, the government minister, spokesperson, or the MP responsible for the Bill initiates the debate. The official spokesperson from the opposition party then articulates their stance on the Bill.

Subsequently, the debate includes perspectives from other opposition parties and backbench MPs. The culmination of this discussion sometimes leads to a vote in the Commons to determine if the Bill should progress to the next stage, known as the committee stage.

It’s worth noting that a Bill can advance to the second reading without a formal debate if MPs unanimously agree on its progression. After the second reading, the Bill moves on to the committee stage, where each section (clause) and any proposed amendments are subject to further discussion.

The Renters Reform Bill includes many changes to the Private Rented Sector aimed at providing secure tenancies for renters and improving landlords’ rights.

The bill includes the following clauses:

• Abolish section 21 or “no-fault evictions”, providing greater stability and certainty for renters.
• Improve grounds for possession, including reducing notice periods when the tenant is clearly at fault – this will also include more stringent punishments for antisocial behaviour. 
• If a tenant refuses to move out, speed up the court proceedings so landlords can gain control of the property. Section 21 will remain in place until possession ground and court processes strengthen.
• Introduce a Privately Rented Property Portal so landlords can demonstrate their responsibilities and compliance with the Renters Reform Bill. This will support councils to enforce punishments on criminal landlords.
• Introduce a Private Rented Sector Landlord Ombudsman for quick and cost-effective dispute resolutions.
• Ensure landlords can increase rent in line with national levels and prevent forced evictions.
• Allow legal rights for tenants to request a pet and provide clarity on cases where landlords can refuse a pet in the home.
• Extend the Decent Homes Standard to the PRS so tenancies meet the lowest required standard for housing.
• Ensure landlords and agents cannot ban tenants who receive benefits or have children while ensuring landlords still have the final say over who lives in their property.

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Some MPs have claimed the Renters Reform Bill will force landlords out of the market. However, the Renters Reform Coalition have pointed out that past polls have shown “broad public support for pro-renter measures in the bill and even those that go well beyond the legislation, including from Conservative voters”.

Because the Bill has now had the second reading in the House of Commons, it will be carried over to the next Parliamentary session following the November King’s Speech.

As told in the Telegraph, the government has tried to prevent an MP rebellion over the Renters Reform Bill and encouraged MPs to abstain from the vote if they opposed.

Those rebels see the Bill as anti-landlord and worry property investors will sell their homes as a result.

Interestingly, 87 MPs and five cabinet ministers earn income as landlords.

Labour had pledged to support the Renters Reform Bill, meaning it will likely become law.

A conservative spokesperson said: “The Renters Reform Bill delivers on our manifesto commitment to create a fairer private rented sector for both tenants and landlords.

“We are progressing the Bill through Parliament with a second reading so we can create a private rented sector that is fit for the 21st century.”

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The reading took place on Monday afternoon.

No vote was taken on the Bill.

Michael Gove spoke about the need to consider the needs of landlords and tenants to move the BIll forward, acknowledging issues with the student market and promising to regulate student properties.

MPs spoke about the justice system’s role in the Renters Reform Bill. A spokesperson for Rishi Sunak said:

“The bill will deliver on the government’s manifesto commitment to abolish no-fault evictions. On the court’s point specifically, obviously, it’s right that the courts are ready for what will be the most significant reforms to tenancy law in three decades.”

“It is obviously right that we put in place the necessary provisions before introducing that power.”

Gove stressed that the government would remove Section 21 and strengthen Section 8, helping landlords regain possession of properties when required, ensuring antisocial and troublesome tenants could be removed from the property with minimal delays.

As the information above shows, while the Renters Reform Bill will abolish Section 21, landlords stand to gain more rights and protections.

The abolishment of Section 21 could attract more tenants into the Privately Rented Sector, adding to an already high demand in the market. A more robust and more secure market is good for landlords and tenants. 

In addition, landlords will have more rights to remove unscrupulous tenants who do not pay their rent or exhibit antisocial behaviour, with the Renters Reform Bill pledging to reduce court proceedings and notice periods when tenants are clearly in the wrong.

With the Renters Reform Bill now in the committee stage, landlords should ensure they know how this affects them and how their rights may change if the Bill becomes law in the future.

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