HOW THE RENTERS REFORM BILL HELP BALANCE THE RENTAL MARKET
Tom Condon
June 15th, 2023
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Landlords worry not! Here at The Property Sourcing Company, our observations suggest anything other than the doom and gloom being reported in the news. The rental market has remained relatively stable, and we are proud to say we have not witnessed any significant upheavals.
As we primarily cater to professional portfolio builders, we have noticed a notable increase in newcomers entering the market, bringing fresh talent and perspectives.
Simultaneously, we have observed a few established landlords choosing to exit the market, potentially due to personal reasons or strategic decisions.
Despite these dynamics, when analysing our extensive investor database, consisting of over 3000 individuals, we have consistently found that the proportion of properties with tenants has remained steady at 27% year on year.
This statistic indicated that the demand for rental properties has been relatively consistent, with a considerable portion of investors maintaining tenants in their properties despite the announcement of the Renters Reform Bill.
It also suggests that the rental market offers a viable and lucrative investment opportunity for many individuals within our investor network.
No-fault evictions are an issue, there’s no side-stepping it — they are an issue for both landlords and tenants alike.
There have long been concerns that no fault evictions have been used by some ‘bad egg’ landlords to intimidate tenants or remove tenants from their properties for no good reason.
But, most normal landlords will only serve the Section 21 Notice either at the end of a predetermined tenancy agreement or at the end of a periodic tenancy and not if the tenant is being a tiny bit rowdy.
Why Does The Government Need To Ban No-Fault Evictions?
No-fault evictions, also known as Section 21 evictions, allow landlords in the UK to evict tenants without providing a specific reason for doing so.
One of the main reasons the government needs to ban no-fault evictions is to provide increased protection for tenants. No-fault evictions can leave tenants vulnerable to sudden displacement and risk of homelessness.
By removing the ability of ‘bad egg’ landlords to evict tenants without providing a reason, the government aims to enhance stability and security in the rental market.
Furthermore, no-fault evictions have been criticised for being unfair to tenants, as they can be evicted even if they are good tenants who have met their rent payments and maintained the property.
Which is why the Renters Reform Bill looks to strengthen landlord-tenant relationships for better living conditions.
The Renters Reform Bill will help balance the rental market by addressing some of the stress that tenants and landlords feel when dealing with each other.
The Reform Bill will do this by creating a new ombudsman that allows tenants to make complaints against their landlords without taking them to court.
But, allow landlords more possession rights if the tenant is at fault and there is evidence to prove that they show antisocial behaviour or are in repeat rent arrears.
How Does The Renters Reform Bill Benefit Landlords?
While the predominant aim for the Renters Reform Bill is to protect tenants, it also has some handy positive effects for landlords.
The ban on no-fault evictions promotes greater stability in the rental market, with no-fault evictions prohibited, landlords can expect longer-term tenancies with reduced turnover of tenants.
The stability may lead to fewer void periods and minimise the costs associated with finding new tenants, which should balance out the risk attached to periodic tenancies.
When tenants feel secure in their own homes, they are more likely to take better care of the property which will lead to reduced maintenance costs for the landlord. It can also enhance communication and cooperation between the parties and facilitate prompt rent payments.
Landlords who respect tenant rights and adhere to the law, including the ban on no-fault evictions, can build a positive reputation within the rental market. This can attract responsible and reliable tenants reducing the likelihood of rent arrears or property damage.
A survey, completed by Mortgages for Business suggests that a third of landlords in England are worried about the abolishment of Section 21 Notice.
The worry from landlords has been evident within property news sites, claiming the rental market is a free for all as many landlords have set out to evict their problematic tenants ‘while they still can.’
However, we spoke to our CEO, Jonathan Christie, who suggested that the Renters Reform Bill will provide more structure and fairer eviction processes for tenants and landlords.
Jonathan said, “Under the Renters Reform Bill, landlords will be unable to operate under a blanket ban on renting families with children or people on benefits, which helps more people move out from their childhood homes.”
“But, it will also introduce more possession grounds for which landlords can evict the tenants, like in cases of antisocial behaviour and repeat rent arrears.”
“As long as there is evidence to support the grounds for eviction from the landlord, this will ensure that their tenants are treated fairly throughout the eviction process while allowing the landlord to regain possession of their property.”
“Unfortunately, we’ve seen a huge spike in buy-to-let landlords looking to sell their tenanted properties. This is because of the panic being suggested by media outlets that they would not be able to evict troublesome tenants.”
“However, this is not the case; in fact, the Renters Reform Bill looks to bolster landlord confidence by introducing a structured framework around the eviction process and even introduce new eviction grounds for if a tenant is persistently unable to meet their rent.”
“There is still some time to go before the Renters Reform Bill becomes law, and we’re sure that the end product will be a much more watered down version of what we are being sold at the moment.”
“While the initial shock of the new Renters Reform Bill has created panic, we hope that the new law will provide confidence for landlords, and protection for vulnerable tenants alike.”
What Are Landlords Saying?
We spoke to Simon Bland, the Director of sbliving, a leading Leeds based Letting Agent about his thoughts on how the Renters Reform Bill will affect the rental market.
Simon said, “The Renters Reform Bill is good news for tenants and should not be of great concern to landlords. Among other changes the legislation will provide that tenants have more security over the property they are renting, greater flexibility in their length of stay and more rights to keep pets.”
“Landlords will lose section 21 rights but will still be able to evict using section 8 Grounds for anti-social behaviour, rent arrears, selling the property or moving into their property.”
“When letting properties we are expecting landlords to ask more questions up front and be more risk averse when vetting potential tenants and there to be a greater churn of tenant change overs due to the 2 month fixed term contracts that will be in place.”
“With the new landlords Ombudsman being formed, now is a great time for landlords to appoint a professional and experienced managing agent!”
Start your property portfolio today!
Landlords worry not! Here at The Property Sourcing Company, our observations suggest anything other than the doom and gloom being reported in the news. The rental market has remained relatively stable, and we are proud to say we have not witnessed any significant upheavals.
As we primarily cater to professional portfolio builders, we have noticed a notable increase in newcomers entering the market, bringing fresh talent and perspectives.
Simultaneously, we have observed a few established landlords choosing to exit the market, potentially due to personal reasons or strategic decisions.
Despite these dynamics, when analysing our extensive investor database, consisting of over 3000 individuals, we have consistently found that the proportion of properties with tenants has remained steady at 27% year on year.
This statistic indicated that the demand for rental properties has been relatively consistent, with a considerable portion of investors maintaining tenants in their properties despite the announcement of the Renters Reform Bill.
It also suggests that the rental market offers a viable and lucrative investment opportunity for many individuals within our investor network.
No-fault evictions are an issue, there’s no side-stepping it — they are an issue for both landlords and tenants alike.
There have long been concerns that no fault evictions have been used by some ‘bad egg’ landlords to intimidate tenants or remove tenants from their properties for no good reason.
But, most normal landlords will only serve the Section 21 Notice either at the end of a predetermined tenancy agreement or at the end of a periodic tenancy and not if the tenant is being a tiny bit rowdy.
Why Does The Government Need To Ban No-Fault Evictions?
No-fault evictions, also known as Section 21 evictions, allow landlords in the UK to evict tenants without providing a specific reason for doing so.
One of the main reasons the government needs to ban no-fault evictions is to provide increased protection for tenants. No-fault evictions can leave tenants vulnerable to sudden displacement and risk of homelessness.
By removing the ability of ‘bad egg’ landlords to evict tenants without providing a reason, the government aims to enhance stability and security in the rental market.
Furthermore, no-fault evictions have been criticised for being unfair to tenants, as they can be evicted even if they are good tenants who have met their rent payments and maintained the property.
Which is why the Renters Reform Bill looks to strengthen landlord-tenant relationships for better living conditions.
The Renters Reform Bill will help balance the rental market by addressing some of the stress that tenants and landlords feel when dealing with each other.
The Reform Bill will do this by creating a new ombudsman that allows tenants to make complaints against their landlords without taking them to court.
But, allow landlords more possession rights if the tenant is at fault and there is evidence to prove that they show antisocial behaviour or are in repeat rent arrears.
How Does The Renters Reform Bill Benefit Landlords?
While the predominant aim for the Renters Reform Bill is to protect tenants, it also has some handy positive effects for landlords.
The ban on no-fault evictions promotes greater stability in the rental market, with no-fault evictions prohibited, landlords can expect longer-term tenancies with reduced turnover of tenants.
The stability may lead to fewer void periods and minimise the costs associated with finding new tenants, which should balance out the risk attached to periodic tenancies.
When tenants feel secure in their own homes, they are more likely to take better care of the property which will lead to reduced maintenance costs for the landlord. It can also enhance communication and cooperation between the parties and facilitate prompt rent payments.
Landlords who respect tenant rights and adhere to the law, including the ban on no-fault evictions, can build a positive reputation within the rental market. This can attract responsible and reliable tenants reducing the likelihood of rent arrears or property damage.
A survey, completed by Mortgages for Business suggests that a third of landlords in England are worried about the abolishment of Section 21 Notice.
The worry from landlords has been evident within property news sites, claiming the rental market is a free for all as many landlords have set out to evict their problematic tenants ‘while they still can.’
However, we spoke to our CEO, Jonathan Christie, who suggested that the Renters Reform Bill will provide more structure and fairer eviction processes for tenants and landlords.
Jonathan said, “Under the Renters Reform Bill, landlords will be unable to operate under a blanket ban on renting families with children or people on benefits, which helps more people move out from their childhood homes.”
“But, it will also introduce more possession grounds for which landlords can evict the tenants, like in cases of antisocial behaviour and repeat rent arrears.”
“As long as there is evidence to support the grounds for eviction from the landlord, this will ensure that their tenants are treated fairly throughout the eviction process while allowing the landlord to regain possession of their property.”
“Unfortunately, we’ve seen a huge spike in buy-to-let landlords looking to sell their tenanted properties. This is because of the panic being suggested by media outlets that they would not be able to evict troublesome tenants.”
“However, this is not the case; in fact, the Renters Reform Bill looks to bolster landlord confidence by introducing a structured framework around the eviction process and even introduce new eviction grounds for if a tenant is persistently unable to meet their rent.”
“There is still some time to go before the Renters Reform Bill becomes law, and we’re sure that the end product will be a much more watered down version of what we are being sold at the moment.”
“While the initial shock of the new Renters Reform Bill has created panic, we hope that the new law will provide confidence for landlords, and protection for vulnerable tenants alike.”
What Are Landlords Saying?
We spoke to Simon Bland, the Director of sbliving, a leading Leeds based Letting Agent about his thoughts on how the Renters Reform Bill will affect the rental market.
Simon said, “The Renters Reform Bill is good news for tenants and should not be of great concern to landlords. Among other changes the legislation will provide that tenants have more security over the property they are renting, greater flexibility in their length of stay and more rights to keep pets.”
“Landlords will lose section 21 rights but will still be able to evict using section 8 Grounds for anti-social behaviour, rent arrears, selling the property or moving into their property.”
“When letting properties we are expecting landlords to ask more questions up front and be more risk averse when vetting potential tenants and there to be a greater churn of tenant change overs due to the 2 month fixed term contracts that will be in place.”
“With the new landlords Ombudsman being formed, now is a great time for landlords to appoint a professional and experienced managing agent!”
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