What Does Labour’s Renters’ Rights Bill Mean for Landlords?

Labour’s Renters’ Rights Bill, which replaces the Conservatives’ Renters (Reform) Bill, was introduced to Parliament on 11 September 2024. It completed its third reading in the House of Commons on 14 January 2025, with all proposed Government amendments accepted.

Once passed, the Bill will introduce the most significant reforms to England’s private rented sector in a generation. Key changes include:

• The abolition of fixed-term tenancies
• The end of Section 21 ‘no fault’ evictions
• Mandatory landlord registration

The full Bill is available to read online, alongside a Government-produced guide offering further detail.

While acknowledging the need for landlords to have robust possession grounds, the Government emphasised its goal to “level the playing field” by protecting tenants from unfair practices such as excessive rent hikes and forced bidding wars.

Key Provisions of the Bill

1. Written Tenancy Agreements
The Bill will require landlords to provide a written ‘statement of terms’ before a tenancy begins. Regulations will specify required content, and it remains to be seen whether existing agreements must be reissued once those regulations are published.

2. Periodic Tenancies Only
Fixed-term assured tenancies will be abolished. All tenancies will be periodic, with tenants able to end them at any time by giving two months’ notice.

3. Revised Grounds for Possession
Landlords must present evidence to court when seeking possession. Mandatory grounds will guarantee possession if proven; discretionary grounds allow for judicial consideration of reasonableness. The mandatory rent arrears threshold will increase from two to three months, with the notice period doubling to four weeks.

David Smith, Partner at JMW Solicitors, warned that these changes could result in landlords being owed a year’s rent before they are able to recover possession, due to court delays.

4. Limits on Possession for Sale or Own Use
Landlords can still repossess properties to sell or move in, but not within the first 12 months of a tenancy. Notice periods for these grounds will increase to four months. If a landlord evicts under ground 1A to sell, they cannot let or market the property in any form for 16 months.

5. Advance Rent Payments Limited
Landlords will be restricted to requesting only one month’s rent in advance. Tenants may choose to pay more voluntarily, but landlords cannot require it. Deposits remain capped at five weeks’ rent (or six weeks for annual rents over £50,000), with holding deposits limited to one week.

6. Ending Section 21 Evictions
The ban on Section 21 ‘no fault’ evictions will apply to all tenancies—new and existing—simultaneously. Existing fixed-term agreements will convert to periodic tenancies, and no further Section 21 or old-style Section 8 notices will be permitted.

Many landlords fear using Section 8 eviction notices because it has the potential to dramatically lengthen the time it takes before landlords can get their property back, especially when tenants are able to delay an eviction by contesting a reason.

Industry experts, including Paul Shamplina (Landlord Action) and Ben Beadle (NRLA) have both expressed concerns about the readiness of the court system to handle an expected surge in possession claims. They called for urgent investment in judicial infrastructure to prevent delays from undermining the reforms.

7. Annual Rent Increase Limit and Dispute Resolution
Rent increases will be limited to once per year and must reflect market rates. Rent increases can no longer be embedded in tenancy agreements. Tenants may challenge increases via the First-Tier Tribunal without fear of rent being raised above the proposed amount. While speculation about Labour introducing rent controls exists, the party has confirmed it has no such plans.

8. Ban on Rental Bidding Wars
Landlords and agents will be prohibited from soliciting or accepting bids above the advertised rental price.

9. Pet Requests
Tenants will have a right to request permission for pets, and landlords must not unreasonably refuse. Valid grounds for refusal include building restrictions or inappropriate living conditions. Landlords can request pet insurance to cover potential damage.

10. Applying the Decent Homes Standard
For the first time, the Decent Homes Standard will apply to the private rented sector. Currently, 21% of privately rented homes are deemed ‘non-decent’. Landlords who fail to meet the standard may face fines of up to £7,000.

11. Introducing ‘Awaab’s Law’
Clear legal timeframes will be set for addressing serious hazards like damp and mould. This aims to empower tenants to demand safe living conditions.

12. National Landlord and Property Database
A new digital database will register landlords and their properties. It will include records of any offences or penalties. Failure to register will bar landlords from regaining possession and could result in increased fines.

13. Establishing a Landlord Ombudsman
A new ombudsman service will be mandatory for all private landlords in England. It will offer impartial, binding resolution of disputes and prevent escalation to court. Civil penalties for failure to join could reach £7,000 initially and up to £40,000 for repeated breaches.

14. Ending Discrimination Against Tenants with Children or Benefits
Blanket bans on tenants with children or those receiving benefits will be outlawed. However, landlords can still assess affordability on an individual basis.

15. Strengthening Local Council Powers
Local authorities will be granted stronger investigatory and enforcement powers. Civil penalties for non-compliance will rise to £7,000 for minor breaches and up to £40,000 or criminal prosecution for more serious cases. Rent Repayment Orders (RROs) can now apply to any landlord in the tenancy chain, and the maximum penalty may rise to 24 months’ rent.

The Government has also reaffirmed its commitment to minimum energy efficiency standards for rented homes by 2030.

What next?

Industry experts predict the bill will become law in July. As a result, many UK landlords have already exited the private rented sector (PRS). The number of Section 21s issued is already 7% higher than previous years, suggesting many more landlords will exit the sector leading some property experts to predict property prices will drop sharply when the billed is passed if the market is swamped with ex rental properties.

Our advise to UK landlords is to make sure you are familiar with the implications of the bill and do not wait until the bill is passed to plan your response.

To help you decide what to do, we have created a guide to help landlords plan their strategy

Alternatively, if you would like to discuss your portfolio with us, get in touch today.