The Renters’ Rights Bill has now received Royal Assent, marking the most significant overhaul of the private rented sector in decades.

It is a pivotal moment, bringing substantial changes for landlords across three key areas: rent review procedures, length of occupation and administrative requirements.

It is important to note that the majority of the Act is not yet in force but, having been passed into law, will be effective at the date of the Government’s choosing. The Government has stated that ministers will outline how and when the reforms will be rolled out in the coming weeks.

For landlords, the key reforms in the Act are as follows:

• All Assured Shorthold Tenancies (ASTs) will convert to periodic agreements with no fixed end date.
• Tenants will be able to serve a notice to quit from day one of a tenancy with two months’ notice.
• Section 21 ‘no fault’ evictions abolished – landlords will need specific legal grounds for regaining possession.
• The threshold for eviction under Section 8 will rise from two to three months’ rent arrears.
• Rent rises will be limited to once per year, capped at market levels and only one month’s rent in advance will be allowed.
• Tenants will be empowered to challenge unreasonable rent increases.
• A new ombudsman, tenant redress scheme and landlord database will be introduced.
• Maintenance and repair obligations will increase to comply with Decent Homes Standard and Awaab’s Law (latter to increase focus on hazards such as damp and mould).
• Tougher penalties for non-compliance and greater enforcement.

What are the implications?

This is a major piece of legislation, introducing a wide range of new rights and responsibilities for both landlords and tenants. Given the scale of the changes, a phased introduction of the reforms will be welcome. The Government indicated in the final Parliamentary session that it wanted to ensure the sector had sufficient time to adjust and prepare for the significant change in regulation and would set out its implementation plans as soon as possible.

Many farms and estate businesses will be affected. While the Act doesn’t apply to residential property let under an FBT or AHA tenancy, it will cover any residential property on a holding that’s sublet under an AST or Assured Tenancy.

There will be cost implications for landlords, including new administrative requirements such as registering and paying fees for a tenant redress scheme and landlord database, as well as increased maintenance obligations.

Keeping detailed records and also carrying out thorough tenant checks will be more important than ever.

However, after years in the making, it’s positive to finally have clarity on how the Private Rented Sector will be expected to operate. We also hope this Act will draw a line in the sand on tenancy reforms and provide greater stability for the future.

How can we help?

Landlords are entering a more complex and demanding era, but our team can help you to successfully navigate what these changes mean for your rural business. These changes will make it more important than ever to stay on top of your legal responsibilities and day-to-day obligations. Expert guidance and support can make a big difference.

Strutt & Parker’s Rural team can:

• Advise on how the reforms impact on accommodation for agricultural workers.
• Manage tenant screening, reducing stress and risk.
• Provide updated tenancy documents and advise on rent-setting strategies.
• Ensure all registration, regulation, and health & safety requirements are met.

Please contact Sarah Roberts or Jess Mountain if you would like to know more.