New legislation will modernise how the country’s “insecure and unjust private rented sector” is regulated, the Government has pledged as rental reforms are again debated in Parliament.
MPs are to consider a ban on what Housing Secretary Angela Rayner branded “outrageous upfront costs” demanded by landlords from new tenants.
An amendment to the Renters’ Rights Bill, back before the House of Commons on Tuesday, proposes to cap advance rent payments at one month’s rent.
Housing Secretary Angela Rayner (Andy Buchanan/PA)
Landlord groups have warned such a move could leave property owners open to risk if tenants have no other way of proving their ability to pay rent on an ongoing basis.
The groups, including the National Residential Landlords Association (NRLA), British Property Federation and Propertymark, said the Government’s proposed changes “risk making access to rented housing harder for the very people we want to support”.
But the Ministry of Housing, Communities and Local Government said landlords would still be able to require a security deposit of up to six weeks rent, giving them the confidence tenants can sustain their tenancy agreements.
The proposed changes also include a long-awaited end to section 21 “no-fault evictions” and protections for bereaved families, with guarantors – often family members – no longer being forced to pay rent for the rest of the tenancy where a loved one has died.
Ms Rayner said: “For far too long working people and families have been at the mercy of a fickle and unfair rental market, faced with outrageous upfront costs, and struggling to find a safe and secure place they can truly call home.
“We are delivering on our promise to transform the lives of millions of renters so families can put down roots, allow their children to grow up in secure and healthy homes, and make sure our young people can save for their future.”
Housing minister Matthew Pennycook is expected to tell the Commons the Bill will “modernise the regulation of our country’s insecure and unjust private rented sector, levelling decisively the playing field between landlord and tenant”.
He will add: “It will empower renters by providing them with greater security, rights and protections so they can stay in their homes for longer, build lives in their communities and avoid the risk of homelessness.
“It will ensure we can drive up the quality of private rented housing so that renters have access to good quality and safe homes as a matter of course.
“And it will allow us to crack down on the minority of unscrupulous landlords who exploit, mistreat or discriminate against renters.”
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Welcoming the proposed changes, housing charity Shelter said they will mean hopeful tenants no longer have to “magic up eye-watering sums up front”.
But the charity called for the Government to go further, limiting the amount rent can rise by during a tenancy.
Polly Neate, chief executive of Shelter, said: “To truly make renting more secure and affordable, the Bill must limit in-tenancy rent increases in line with either inflation or wage growth.
“It must also stamp out the other discriminatory practices, like unnecessary demands for guarantors, that drive homelessness by locking people out of private renting.”
The Government has said it will end rental bidding wars and tackle unreasonable rent increases.
The coalition representing landlords and those in the property sector said: “Limiting rent in advance, combined with frozen housing benefit rates and not enough rental housing, will make it all but impossible for those with poor or no credit histories in the UK to prove their ability to sustain tenancies.
“This includes international students, workers from overseas and those employed on a short-term or variable basis with an income that fluctuates.
“Cutting off any assurance landlords might seek when renting to those who cannot easily prove their ability to afford a tenancy is neither practical nor responsible.
“Those who will suffer are those most likely to struggle to pass affordability checks.”