UK: Renters (Reform) Bill – What's New (Especially For Landlords Of Students)?

Key Amendments from the Public Committee Stage

1. New Ground of Possession for Student Houses in Multiple Occupation

The Bill will end fixed-term tenancies and assured shorthold tenancies so that tenancies will instead be periodic and assured. There has been considerable consternation among student landlords in the private rented sector regarding the detrimental impact of removing fixed term tenancies and 'no-fault' evictions. Simply put, students may not be moved on in accordance with the academic year.

This amendment introduces a new ground of possession for landlords – Ground 4A – and allows a landlord to seek possession of a property where it was let to a full-time student/someone the landlord reasonably believed would become a full-time student during the tenancy. The date of the notice seeking possession is between 1 June and 30 September (i.e. the end of the academic year). This ground recognises that landlords in this space operate a cyclical model and require vacant possession in time for the new student year. It allows for mandatory possession (so a court must make a possession order if the ground has been proven).

2. There is still a problem for Purpose-Built Student Accommodation

When the Bill was first published, the Explanatory Notes indicated that Purpose-Built Student Accommodation (PBSA) would not be subject to the reforms so long as the provider was registered for a government-approved code. Therefore, these PBSA operators could still grant fixed-term tenancies and obtain possession after the expiry of the term in the normal way. However, despite this clear legislative intent, there was no mechanism within the Bill to make this a reality. It was expected that a mechanism to exempt PBSA from the tenancy reforms would be introduced via an amendment, but this has not yet happened. As the Bill now stands, PBSA operators are not exempt from the tenancy reform. Therefore, they will have to let on periodic assured tenancies and will need to find a ground of possession to evict tenants (which is not the new ground of possession 4A, above, because that does not apply to PBSA).

The new possession ground 4A only applies to Houses in Multiple Occupations (HMOs). PBSA is not usually considered to be an HMO. This is because a PBSA usually falls within the exceptions to HMOs (as set out in paragraph 4, Schedule 14 of the Housing Act 2004), as it is managed in accordance with codes of practice, usually the Universities UK/Guild HE Code of Practice or the ANUK/Unipol Code of Standards for Larger Residential Developments).

3. Superior landlords can face enforcement and penalties

An amendment has been put forward to address the judgment of the Supreme Court in Rakusen v Jepsen and others, [2023] UKSC 9. That case found that a Rent Repayment Order (and other specified penalties) could not be made against a superior landlord; this case was closely followed by those operating a 'rent-to-rent' model. The amendments in the Bill mean that superior landlords can now be sanctioned for various housing-related breaches. Penalties can either be apportioned between the immediate and superior landlords, or else the landlords can be made jointly and severally liable.

4. Clear rules against discrimination

In the course of letting a property, it will be an offence to discriminate on the basis that:

1. The person requiring the tenancy or entering into the tenancy is a benefits claimant. There is an exception if there is insurance in place, which means such a letting would amount to a breach of the insurance.
2. A child would live with or visit a person at the dwelling. There is an exception if such discrimination can be shown to be a proportionate means of achieving a legitimate aim, or else there is insurance prohibiting a letting to a person with a child/a person whom a child would be visiting.

5. Decent Homes Standard in the private rented sector

Amendments have been introduced allowing for regulations to be made which specify the requirements that must be met in England by qualifying residential premises. There is also scope for enforcement of these requirements by local housing authorities. No regulations are available, so the detail is not yet there, although the introduction of the Decent Homes Standard into the private rented sector (PRS) have been heavily foreshadowed. Requirements for the PRS could include the state of repair of the premises, things to be provided for use by, or the safety, security or comfort of those occupying, and the means of keeping the premises at a suitable temperature.

These requirements would apply to a wide range of tenancies in England (including assured, agricultural and Rent Act tenancies) in HMOs unless the HMO is social housing and the landlord or provider of accommodation is a registered provider of social housing.

6. Tougher investigative powers

Several amendments have been added to strengthen local housing authority powers to uncover and sanction breaches of the legislation:

1. Power to enter business premises without warrant and seize documents, where there is a reasonable belief that the premises are occupied by a relevant person for the purpose of a rental sector business, for a purpose connected with the legislation (this power does not apply if the premises is wholly or mainly used as residential accommodation);
2. It is proposed that local housing authorities will have the power to require any relevant person to provide information in a notice, investigate whether there has been an offence under the legislation, or determine the amount of penalty. This power is similar to existing powers under other legislation thatallow for information gathering to identify breaches.