Labour is launching the The Renters’ Rights Bill to Parliament today, described by some as the biggest shake up to the rental sector in nearly 30 years. Whilst the Conservative Party tried but ultimately failed to introduce new legislation, given Labour’s urgency around this matter it is expected this Bill will pass into law once it has been through the legislative process.

Labour’s plan.

Abolish Section 21 “no fault evictions”.

This ban will mean a landlord will need to provide a valid cause to end a tenancy early and it is planned to apply this to new and existing tenancies at the same time. The idea behind the ban is to give all private renters immediate security and assurance.

Rent increases.

Banning in-tenancy rent increases. Under the planned legislation landlords will only be allowed to raise the rent once a year, and to the market rate.

Apply a Decent Homes standard to private rentals including applying Awaab’s Law

The aim is to ensure rental homes are safe and secure and to address poor-quality housing. There will also be clear legal timelines for landlords to address serious hazards in homes. Landlords who fail to address serious hazards can be fined up to £7,000 by local councils.

Prohibit discrimination against tenants receiving benefits or with children.

Abolishing blanket bans on tenants with children or those in receipt of benefits to ensure fair access to housing for all.

Establish a property ombudsman service.

A new service designed to offer quick, impartial dispute resolution, reducing the need for court proceedings. With the courts already facing long backlogs dealing with evictions, there is concern new legislation may make this wait even longer.

Landlord view

It is anticipated these changes are likely to continue the exodus of landlords - most of whom rent out 1 or 2 properties - from the market. With expected tax changes in the October budget also expected to further impact landlords it is likely they will continue to sell properties. Properties that are being sold won’t necessarily be suitable for first time buyers, such as 3 or 4 bedroom homes, so there is a concern that the existing shortage of rental properties will further increase.

What next?

Today is the first reading of the Bill and there are a number of steps that need to be followed before a Bill becomes law.

CreditLadder can help you improve your credit score

CreditLadder can improve your credit position by reporting your rent payments. CreditLadder is the first way to improve your credit score and position across all four of the main Credit Reference Agencies in the UK, namely Experian, Equifax, TransUnion and Crediva. Building up a high credit score has a lot of benefits, including helping you access finance at better rates - this can also help save you money.

CreditLadder also runs a free mortgage application service in partnership with Tembo which will tell you how much you could borrow.

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