The Renters' Rights Bill, introduced in September last year is now in its final stages of Parliament. The House of Commons returned the Bill to the House of Lords, having disagreed with their amendments, and the Lords’ consideration of Commons’ amendments and reason is scheduled for 14 October, following which it is expected to receive Royal Assent, before consultation commences on secondary legislation.  One of the key reforms, once the Bill passes into law, will be  the creation of a new Private Rented Sector Landlord Ombudsman Service, which all private landlords with assured or regulated tenancies will be legally required to join, including those who use managing agents.

The most recently agreed amendments include:

• Advance rent limits: Landlords will only be allowed to request one month’s rent in advance, plus a security deposit of up to five or six weeks’ rent. This will not apply to tenancy agreements in place before commencement and so will not require to be amended.
• Student agreements: Students cannot be required to sign rental agreements more than six months before moving in. Purpose built student accommodation (PBSA) will be exempted from the new periodic assured tenancy system.
• Local authority investigatory powers: Local authorities will no longer be required to give prior notice to the landlord before entering premises without a warrant for enforcement actions.

Existing proposals:

• Abolition of Section 21: Landlords will no longer be able to evict tenants without a valid reason, as defined in law under the prescribed grounds for possession with mandatory minimum notice periods for each of these grounds. Removal of fixed-term and Assured Shorthold Tenancies: these will be substituted with Periodic Tenancies, providing greater security for tenants
• Annual rent increases: Landlords can increase rents once a year, but they must give at least two months' notice with a new power to the  Secretary of State to make regulations to change the date from which tenants would be required to pay a new rent following an application to the First-tier Tribunal to challenge to a proposed rent increase
• Stronger action against unethical landlord practices: Local councils will be given more power to crack down on the worst offenders, with fines lifted to up to £40,000
• Ban on discrimination: Landlords cannot discriminate against tenants with children, those receiving benefits, or owning pets, though they will be able to require pet insurance
• Prohibition of rental bidding: Properties cannot be rented for more than their advertised price
• Landlord responsibilities: All private landlords will be required to join and pay fees to  the Private Rented Sector Landlord Ombudsman Service, which will handle landlord tenant disputes and require landlords to pay compensations
• Regaining possession: Allowed after the first 12 months with four months’ notice for moving into the property or sale reasons
• The Decent Homes Standard: Although previously applied only to social housing, this will now extend to private rentals to ensure properties meet requirements for a safe and decent home.

Private Rented Sector Landlord Ombudsman Service

This Ombudsman Service allows tenants to file complaints about their landlords at no cost. It aims to offer fair and unbiased solutions, with the power to require landlords to apologise, provide information, take corrective actions, or pay compensation. Landlords will also benefit, as the service will help resolve complaints efficiently and offer guidance on improving their handling of tenant issues.

The Bill also includes strong enforcement measures for the Ombudsman Service. Local councils will be able to take action against landlords who do not join the service or who market properties without registration. Civil penalties can reach up to £7,000 for first-time offences and up to £40,000 for serious or repeat non-compliance and criminal prosecution for repeated violations. Tenants can also seek a rent repayment order if landlords repeatedly fail to join the Ombudsman Service. Furthermore, landlords must comply with the decisions made by the Ombudsman; failing to do so may result in expulsion from the service and enforcement actions from local councils, although there will be a process for landlords to rejoin if they address their compliance issues.

Find out more on the Government's official webpage.