As the debate around the Renters (Reform) Bill rages on, the BBC has reported that a series of draft amendments to the bill have been shared with a group of Tory MPs, many of which are rumoured to be landlords themselves.
The Renters (Reform) Bill, which had its second parliamentary hearing in October 2023, aims to provide a fairer private rented sector for tenants. One of the key elements of the bill is to end no fault evictions.
As things currently stand, a landlord can choose to end a tenancy by serving the tenant with a Section 21 notice without reason, but not during a fixed term agreement.
A fixed term Assured Shorthold Tenancy (AST) is where the landlord and the tenant agree to a set period within which both parties will fulfil their respective obligations, as set out in the contract. Neither party can choose to end the contract before the pre-agreed end date unless there is a breach, a break clause, or by mutual agreement.
Should the tenancy continue beyond the initial term, without a new fixed term contract in place, it becomes a Periodic Tenancy, whereby the tenancy rolls on with no fixed end date. The landlord can choose to end the tenancy, without reason, by serving a Section 21 notice, giving the tenants 2 months to vacate.
Initial drafts of the Renters (Reform) Bill removed the landlord’s ability to serve a Section 21 no fault eviction notice on the tenant. The tenant would however be able to end the tenancy at any point by giving the landlord 2 months notice, thereby putting the landlord at risk of multiple short term tenancies and the associated costs of sourcing new tenants.
Other provisions within the bill would enable the landlord to end the tenancy, but only under certain circumstances such as needing to sell. Thereby giving the tenant the overwhelming majority of power to bring a tenancy to an end.
Potential amendments to the bill
The recent BBC report concerning new draft amendments to the bill suggests that the government is reconsidering this imbalance between the landlord’s and the tenant’s ability to end a tenancy. It is suggesting that a tenant would not be able to serve notice within the first 4 months of the tenancy meaning that the earliest it could end is 6 months.
This is potentially good news for landlords as it will give them the certainty of at least a 6 month tenancy.
https://elloproperty.co.uk/blog/f/the-rental-reform-bill—in-a-nutshell