The Renters’ Rights Bill has passed it’s third reading in parliament, confirming amendments including landlords being banned for asking for more than one month’s rent in advance.
Matthew Pennycook, housing minister, addressed concerns about the move, saying there’s still the option of the landlord requesting a guarantor or using landlord insurance.
Pennycook, speaking in parliament for the third reading of the bill, said: “Requiring multiple months of rent from a tenant in advance when agreeing a tenancy is unfair, places considerable strain on tenants and can exclude some people and families from renting altogether.
“Landlords will continue to be able to take a holding deposit of up to one week, a tenancy deposit of five or six weeks’ rent and up to one month’s rent in advance before a tenancy has begun.
“They will also be free to undertake the necessary referencing and affordability checks to give them confidence that a tenancy is sustainable for all parties.
“If and when they are not satisfied by the outcomes of pre-tenancy checks, options are available to tenants and landlords to ensure that rent in advance need not be used—requesting a guarantor or engaging in landlord insurance, for example.”
In terms of other amendments in the Rights’ Rights Bill:
- Students can no longer be locked into a rental agreement more than six months in advance
- The fee landlords will pay towards a national database will directly fund the private rented sector Ombudsman, which will judge disputes between landlords and tenants
- Guarantors will not be liable for rent if a tenant dies, if they are a family member
Brendan Geraghty, chief executive of the Association for Rental Living, said: “The greatest impact of these ‘unintended consequences’ will be felt by the self-employed and retirees, who are often able to make lump-sum payments but cannot provide sufficient proof of income to satisfy landlords.
“The move will also impact overseas students and professionals who are unable to pass referencing checks due to the inability to perform financial checks.
“This measure would also prevent students from paying their rent in line with their student loan (in three tranches across the academic year) and may lead to an increased number of students falling into arrears and facing financial pressures.”