Amendments to the Renters’ Rights Bill including one making it easier for student landlords to reclaim properties have been controversially rejected.
The House of Lords requested Ground 4A to be extended to all student properties, meaning all student landlords would have been able to reclaim properties in time for the next cohort of students in the academic year. Now that will only apply to student HMOs of three or more bedrooms.
Secondly housing minister Matthew Pennycook rejected an alteration that would have allowed landlords to re-let a property six months after evicting a tenant for the purpose of selling up. Landlords in that situation will instead have to wait 12 months.
Thirdly, calls for landlords to be able to charge tenants an extra three weeks’ deposit for keeping pets were rejected.
One amendment that did go through was allowing agricultural landlords to evict tenants to house employees and non-employees involved in farming.
Meanwhile, in times where tenants appeal against a rental increase at a tribunal, Pennycook agreed to introduce a delegated power to enable the backdating of rent rises.
Some 20 non-government amendments were rejected.
Student amendment rejection
Property organisations are particularly withering about the student amendment rejection.
Ben Beadle, chief executive of the National Residential Landlords Association, said: “Around a third of housing typically lived in by those in their second year of study and above is one- and two-bedroom properties.
“Under current proposals, neither landlords nor students will have certainty that this type of housing will be available from one academic year to the next.
“The NRLA has proposed a reasonable compromise to protect the annual cycle of the vast majority student housing, whilst also safeguarding the rights of non-traditional students that ministers say they want to protect. Regrettably, this has been met with silence from the government.
“Ultimately, it is students who will lose out – left unable to plan with any certainty where, and with whom, they will live at the start of each year of study.”
Following a government amendment Purpose Built Student Accommodation is set to be exempt from the Bill.
Re-let amendment rejection
Housing minister Matthew Pennycook argued that some landlords would misuse Ground 1A evictions and relet their property at a higher rate – if they only had to wait six months rather than 12.
Greg Tsuman, managing director for lettings, Martyn Gerrard Estate Agents, said: “Keeping the 12-month relet restriction ignores the unpredictable nature of the housing market. A landlord who can’t sell shouldn’t be forced to keep a property empty for a full year. It’s yet another example of how rigidity in legislation can backfire on both landlords and renters.
“Looking at the recent Rushanara Ali case, sometimes a property needs to return to the market sooner, whether due to failed sales, financial pressure, or changing circumstances. Locking perfectly good homes out of circulation for 12 months punishes both tenants and landlords and deprives the Treasury of taxable rental income. Why should a willing tenant be barred from reoccupying a perfectly good home? Surely the government hasn’t got that much money to throw away, when six months of rental income tax could be generated.
“In honest cases, this rigidity serves no one – not renters, not landlords, and certainly not the taxpayer.”
Marc von Grundherr, director of agency firm Benham and Reeves, said: “Matthew Pennycook has justified rejecting the majority of Lords’ amendments by suggesting that landlords would exploit any concessions to behave poorly. This narrative is both unfair and inaccurate.
“The vast majority of landlords are honest, hard-working individuals who operate in an ethically sound manner and provide a vital service to millions of tenants.
“Demonising them is not only misleading, it risks further destabilising the rental market at a time when supply is already critically short – so it’s extremely disappointing to see landlords used as a scapegoat to prevent the necessary changes required to balance the Bill.”
Pet amendment rejection
Pennycook argued that landlords already have the necessary powers to charge higher deposits for tenants with pets, under the Tenant Fees Act 2019.
Greg Tsuman, managing director for lettings, Martyn Gerrard Estate Agents, said: “Rejecting the pet deposit amendment doesn’t empower tenants. If landlords can’t require a deposit or insurance to cover pet-related damage, many will simply price in the risk by raising rents across the board.
“That doesn’t help tenants – it drives defensive pricing, reduces affordability and choice, and unfairly penalises those without pets for rules meant to protect those with them.”
Timeline needed
The NRLA expressed disappointment that no timeline has been given on when these reforms will come to pass.
Beadle added: “With the Bill now close to receiving Royal Assent, the government needs to make clear how long after this it expects to begin rolling out the widespread reforms. The sector cannot operate, and plan, based on vague and ambiguous statements.
“At least six months will be needed, after regulations are passed, to ensure a smooth transition to the new tenancy system. Anything less will be a recipe for confusion and chaos.”
Too much uncertainty
Marc von Grundherr, director of Benham and Reeves, said: “Matthew Pennycook has justified rejecting the majority of Lords’ amendments by suggesting that landlords would exploit any concessions to behave poorly. This narrative is both unfair and inaccurate.
“The vast majority of landlords are honest, hard-working individuals who operate in an ethically sound manner and provide a vital service to millions of tenants.
“Demonising them is not only misleading, it risks further destabilising the rental market at a time when supply is already critically short – so it’s extremely disappointing to see landlords used as a scapegoat to prevent the necessary changes required to balance the Bill.”
Section 21 still a worry
Responding in the Commons, shadow housing secretary James Cleverly warned against the legislation driving landlords out of the sector.
The elimination of Section 21 evictions is still a topic of anxiety.
Scott Clay, a director at property lender Together, a mortgage lender, said: “These new measures may be an easier pill to swallow than the removal of Section 21 or ‘no fault’ evictions. This could see unjust cases overlooked or ignored – causing costly and time draining situations for legitimate landlords.
“For example, landlords can evict tenants to sell their property, but this cannot be re-let for up to a year if the sale falls through. This could mean houses are left empty for months on end, worsening rather than improving our housing crisis.
“The bill is under immense pressure to positively deliver from both sides – hopes are it properly addresses the concerns of landlords and tenants equally. We shall see.”
Sam Humphries, founder of rental marketplace Dwelly, said: “Even before this Bill has been implemented we’re already seeing a rise in landlord repossessions, driven by a lack of trust in the court system and a desire to regain control of their portfolios before these changes come into effect.
“With only minor amendments made to the Bill and the abolition of Section 21 evictions set to go ahead, this trend is only likely to intensify, putting even greater strain on the courts and leaving many more tenants without a roof over their head.
“It underlines the unintended consequences of pushing through sweeping reforms without properly considering the realities of the rental market.”
What comes next
The Bill will now pass back to the House of Lords before being granted Royal Assent.
It remains to be seen whether it will move between the Lords and the Commons a number of times, but there is thought to be an appetite to get it passed before Labour’s annual conference takes place from Sunday 28 September to Wednesday 1 October.
