Liz Davies takes a close look at Labour’s Renters’ Rights Bill.

Labour’s manifesto promised to end ‘no fault eviction’ in the private rented sector. Its Renters’ Rights Bill, published on 11th September 2024, will do just that.

This is a necessary step. Michael Gove, previous Secretary of State for Levelling Up, Housing and Communities, attempted it in his Renters (Reform) Bill, but it was derailed by Tory MPs representing the landlord lobby, and fell when Rishi Sunak called the general election. Gove was himself implementing a Tory manifesto pledge, first promised by Theresa May and subsequently in the 2019 Conservative manifesto.

So far, so good. Everyone agrees that ‘no fault’ evictions, whereby a tenant is required to leave for no reason whatsoever, upon being given only two months’ notice, and at any time after six months of the tenancy has expired, are profoundly unfair. Not only are they ‘no fault’; they are also ‘no reason’ evictions. Threats of “no fault” evictions are the biggest single reason why people contact local councils saying that they are threatened with homelessness (likely to be homeless within two months).

Tenants face constant uncertainty and potentially a revolving door, moving from tenancy to tenancy. Landlords wield unconscionable power: they can use no fault evictions to increase the rent – which a tenant must agree to or face eviction – or penalise a tenant who is trying to enforce their rights. No matter the reason why the landlord wants possession, and no matter the tenant’s circumstances, blamelessness and even hardship, provided the landlord has complied with certain legal requirements, a possession order must be made by the Court. No fault evictions have been in landlords’ armoury since January 1989; abolition is long overdue.

But sadly, the Bill is a missed opportunity for Labour. It is mildly more progressive than Gove’s Bill. Notably, it will implement abolition immediately, whereas Gove had agreed that no fault evictions would continue until there had been a review of the effectiveness of the Court system, effectively kicking abolition into the long grass. However, emulating Gove’s Bill, Labour is replacing no fault evictions with other ‘mandatory’ grounds for possession, where the landlord intends to sell, to move into the property or to move a family member in. Provided the landlord states that is his or her intention and has completed the correct paperwork, the Court will have no choice but to make a possession order.

Labour’s Bill requires the landlord to give the tenant slightly more notice – four months instead of two months – and gives the tenant an initial longer period before the landlord can seek possession under one of these grounds – 12 months rather than six months. If a landlord subsequently re-lets within twelve months of seeking possession on these grounds, he or she commits a criminal offence, enforceable by the council.

Labour is taking the opportunity to try to improve standards in the private rented sector. The Bill applies the Decent Home Standard to the private rented sector and will implement ‘Awaab’s Law’ whereby private landlords will be required to undertake certain repairs within specified timeframes.

Rent increases are limited to every 12 months and to market levels, enforced by the tenant applying to the Tribunal for determination of the rent. The problem is that this does not amount to any control as to how quickly market rents increase, and with more tenants chasing vacant properties, it is literally a seller’s or landlord’s market. Private rents are currently increasing by an average of 8.6% a year – well above inflation. Landlords will still be able to persuade tenants to leave by simply increasing the rent to the current market levels, higher than the original rent.

The Bill contains a welcome response to the current phenomenon of rent bidding – encouraging prospective tenants to engage in bidding wars, offering rents in excess of the amount advertised and letting to the highest bidder. Landlords and their agents will be prohibited from accepting offers higher than the advertised rent.

But Labour could have been bolder. First, it could have abolished all ‘mandatory’ grounds for possession and replaced them with discretionary grounds. Mandatory grounds – such as the landlord wanting to sell the property – require a Court to make a possession order whatever the circumstances of the tenant. Even if the tenant needed to stay in the property for a limited period, in the most heart-rending of circumstances (such as being in the last stages of a terminal illness), the Court has no choice but to make a possession order. Giving the Court discretion allows for the Court to take into account the tenant’s individual circumstances.

In many cases, where the landlord wanted to sell, move into the property or move a family member in, the landlord’s need for the property would outweigh the tenant’s, but not always. Making those grounds discretionary would have allowed the Court at least to listen to the tenant. Even if Labour was not prepared to make those grounds fully discretionary, there should be some mechanism built in allowing the Court to hear the tenant’s account and her circumstances, perhaps a ‘greater hardship’ test.

Second, without controls on rent increases, both during tenancies and when new tenancies are advertised, rents in the private rented sector will continue to spiral upwards. Landlords claim that any measure improving tenants’ rights, but particularly rent control, will lead to them going out of business and selling properties. This is not the threat it seems. The properties will not disappear overnight. Unlike say, obsolete washing machines, they cannot just be thrown away. They exist and must be sold. If formerly rented properties are for sale, house price inflation might slow down, and previous renters might buy, thus fulfilling Labour’s priority of home ownership, and allowing for a more equitable distribution of resources.

Liz Davies KC is a barrister specialising in housing law. She is co-author of Housing Allocation and Homelessness: Law and Practice (Luba, Davies, Johnston & Buchanan, LexisNexis, 2022, 6th ed).

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