Authors:Legal Action Group
Created:2023-05-23
Last updated:2023-09-18
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The introduction by Michael Gove, the levelling up, housing and communities secretary, of the
Renters (Reform) Bill on 17 May 2023 marked the beginning of the largest reforms to tenancies in England since the Housing Act (HA) 1988. The bill’s headline provision provides for the abolition of assured shorthold tenancies, therefore bringing to an end what are often called no-fault evictions (HA 1988 s21). But tucked away inside the bill are new mandatory grounds for possession that, unless changed through the course of the bill's progress, are likely to work as a backdoor s21.
The bill is a missed opportunity to remove Ground 8 (two months’ rent arrears) from the mandatory grounds for possession, which is instead tweaked to remove any arrears caused by delays in receiving universal credit. A new mandatory ground of having three instances of rent arrears, of more than two months/eight weeks, in three years is particularly harsh at this time, given the cost of living crisis, the abundance of zero-hours employment contracts and the gig economy. Converting this to a discretionary ground to allow for judicial discretion would be a fairer proposition. Mandatory grounds for possession take away judicial discretion and make it hard to obtain legal aid to defend proceedings.
There are other new mandatory grounds to allow landlords to sell and to obtain the property back if they or a relative require it for their principal or only home. This will be open to abuse. If the property is not sold or the landlord or family member doesn’t move in, then the landlord only has to wait three months before re-letting to a new tenant without penalty. It may be that landlords decide not to wait the three months and risk the fine in the hope that a local authority will not take action and an exiting tenant will not notice the re-let.
Key provisions include:
•Assured shorthold tenancies will be abolished, as will fixed-term tenancies.
•All tenancies under seven years will be periodic assured tenancies with a period not exceeding one month.
•Rent increases can only be made every 12 months.
•There will be an implied term that the tenant has the right to keep a pet.
•There will be a database for the private rented sector with a civil penalty of up to £5,000 for non-compliance.
•The landlord redress scheme, when brought in, will be compulsory and failure to be a member will result in a civil penalty of up to £5,000.
Changes to grounds for possession include:
•An amended Ground 1: property required for landlord or family member to live as principal or only home. Notice can only be served six months after commencement of the tenancy and no longer has to be given prior to commencement of the tenancy. If the landlord uses this ground and the tenant leaves, the landlord cannot let the property for the next three months. If the landlord breaches this, the local authority can impose a penalty of up to £5,000 or prosecute for a criminal offence.
•New Ground 1A: the landlord intends to sell the property. The same provisions apply to re-let as in Ground 1.
•Ground 2 is amended such that where possession is required to sell the property by the mortgagee then there is no longer a requirement that the mortgagee has to accept the tenancy that started before the mortgage was taken out.
•Ground 3 (holiday accommodation) is removed.
•Ground 8 is amended such that the amount outstanding for an award of universal credit will be ignored regarding the eight weeks’/two months’ arrears at the date of the notice and the date of the hearing.
•A new Ground 8A: a mandatory ground to catch rent arrears of more than eight weeks/two months on at least three separate occasions in a period of three years.
•In Ground 14 (anti-social behaviour), the ground of ‘likely to cause a nuisance or annoyance’ is replaced with ‘capable of causing a nuisance or annoyance’.