Most of the commentary about the Renters' Rights Bill (RRB) has focused on getting rid of Section 21 notices, which allow landlords to evict a tenant ‘for no reason’ and requires the tenant to leave with just two months' notice.
However, there are lots of other things that landlords – and tenants – won’t be able to do post the Renters Rights Bill and as we are potentially months away from the Bill becoming an Act and being implemented, it’s important to understand what these will be prior to letting or renting a property now.
Please note that the changes below are expected to be applied, but as the legislation is still going through parliament (and applies only to England) we may need to revise the information below.
Here are three things we think you should know before you let and rent a property that are likely to impact on your tenancy in the future.
1) Let a property for less than 12 months – unless you are a tenant
Some landlords only rent their property for a minimum of six months. This might be because they work abroad or away from home for short periods of time or because they could be travelling or visiting relatives.
Once the RRB becomes an act:
- Landlords – you will have to let a property for a minimum of 12 months
- Tenants – you will be guaranteed a 12 month minimum let, while only having to give two months notice
This will also mean for landlords and tenants who like to have long-term tenancy agreements, three years for example, neither party can sign a long-term agreement.
2) Pay for rent upfront
In some cases, a tenant may be cash-rich but not income-rich, or they may not have an income that proves they can pay the rent regularly.
In these cases, tenants typically offer to pay six months or more rent in advance. Sometimes, landlords are happy to discount the monthly rent as they have their money upfront.
When the Bill becomes an Act, tenants cannot do this. Landlords cannot accept any money for rent in advance, they can only accept up to a five week deposit prior to the tenancy agreement being signed.
Landlords, this means you will need to ensure your tenant is referenced carefully prior to letting. Also, if you currently have a tenant who pays rent in advance, do let your local branch know, as we will do what we can to help ensure your existing tenant can still rent the property.
Tenants – if you don’t have the income required to pay upfront you will need to research securing a guarantor. At Your Move we can help with this, so do come and talk to us.
3) Annual rent rises restricted to one per year
Over the last few years, landlords who have had a mortgage may have seen large rises in their mortgage costs and could increase rents more regularly than 12 months, although it’s fair to say that most landlords didn’t do this.
In the future, landlords will be restricted to one rent rise a year – whatever happens to their costs during that year – and the rise will need to be in line with market rents.
In addition, the rent rise must be formally issued through a Section 13 Notice.
If the tenant and landlord are unable to agree on the rent rise requested, the tenants can appeal the increase to the First Tier Tribunal (FTT), and the landlord cannot increase the rent until the FTT has made its decision.
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The Your Move Content Marketing Team
