Amendments tabled to the Renters Rights Bill by the government suggest there may be restrictions on the amount of rent that can be sought in advance of a tenancy.
The I newspaper – which appears to have been used by the government to float ideas about possible future legislation – says agents and private landlords will be banned from asking tenants for several months’ of rent payments in advance.
The I suggests that under changes contained in the amended version of the Bill, agents and landlords will still be able to ask tenants to pay one month’s rent upfront, alongside a deposit of up to six weeks’ rent as allowed under the Tenant Fees Act 2019.
The I says the government and tenants groups say this will provide enough “financial assurance” to landlords while cracking down on “unscrupulous” property owners discriminating against some renters, such as lower earners.
However, landlords claim the policy will leave them more vulnerable to unreliable tenants.
Chris Norris, policy director for the National Residential Landlords Association, says: “Restricting rent in advance, combined with freezing housing benefit rates and not enough rental housing to meet demand is creating significant barriers for those with poor or no credit histories needing to access the sector. This includes international students and those employed on a short-term or variable basis with an income that fluctuates.
“The government is cutting off any assurance responsible landlords might seek when renting to those who cannot easily prove their ability to sustain tenancies and pay their rents. In the end those who will suffer most are those the government most wants to help.
“Ministers must provide clarity on how tenants unable to easily demonstrate their ability to afford and sustain their tenancies should do so. Expecting landlords to take on high levels of risk without practical assurances is not a sustainable solution and risks further exacerbating the challenges in an already constrained market.”
Meanwhile Timothy Douglas, head of policy and campaigns at Propertymark, comments: “Whilst the UK Government want to transform the experience of private renting, by banning the taking of rent in advance they are potentially reducing options for tenants to access private rented property.
“There are a wide range of circumstances and scenarios that impact how people pay their rent, for instance some renters are on fixed incomes, not all tenants pass referencing and affordability checks, and some have insecure incomes due to their work arrangements.
“The UK Government must do more to understand why rent in advance is used by both landlords and tenants and avoid one size fits all policies that mean some tenants may no longer be able to access private rented property.”
Next Tuesday the Bill reaches its Report Stage in the Commons which is normally followed immediately by debate on the Bill’s Third Reading, at which point it will have concluded its passage through the Commons the amended draft legislation then moves to the House of Lords.
Once the Bill reaches the House of Lords it goes through the same stages as it did in the Commons, although the detailed Committee Stage – when the legislation is examined line by line – is normally less exhaustive in the Lords.
If the Lords disagree with the Commons they can amend the Bill and will then send it back to the Commons.
The Commons will consider the amendments made and if they disagree the House of Lords will have to consider their position again and will usually agree to the Bill as returned to them from the House of Commons.
There has been generally widespread agreement between the Labour and Conservative MPs on most parts of the Renters Rights Bill, which is expected to become law in the spring.
You can see the full amended 220-plus page version which will go to the Commons next week, by clicking on this link: https://publications.parliament.uk/pa/bills/cbill/59-01/0127/240127.pdf
