The Renters’ Rights Bill: A better deal for tenants?
By Genevieve Richardson, Senior Public Policy Advocate
The new Government’s commitment to reforming the private rented sector (PRS) is welcome. As a debt charity supporting financially vulnerable clients, one in three of which are private renters, StepChange understands only too well the struggle facing tenants, especially at a time of record private rents.
The long-awaited changes in the Renters’ Rights Bill represent a step in the right direction when it comes rebalancing rights between tenants and landlords. We particularly welcome the Government’s pledge to abolish section 21 ‘no fault’ evictions as soon as the Bill becomes law. These evictions, condemned by housing experts as disproportionate and draconian, are a leading cause of housing insecurity and homelessness.
Will section 21 end insecurity issues in the PRS?
We are concerned, however, that without proper safeguards, ending section 21 evictions without proper care will not meet the stated aim of the Bill to “give renters much greater security and stability”.
Ground 8 of the Housing Act requires a court to grant a landlord an eviction order where a tenant is two months or more in rent arrears. The threat of ‘hair trigger’ ground 8 evictions already drives debt problems among private renters forced into desperation borrowing to keep up with their rent. Given that the most common reason landlords end tenancies is rent arrears, landlords are likely to increasingly seek to use ground 8 to gain possession.
The new Renters’ Rights Bill expands the threshold before which a tenant can be evicted from two to three months, which will provide an extra buffer. But tenants who experience financial difficulty will still be at risk of losing their homes if they cannot quickly bounce back. Unfortunately, life’s fortunes are unpredictable and often not easy to resolve quickly — with the duration of a period of sickness, a spell of unemployment, the time it takes to leave an abusive relationship rarely ending neatly within two months — yet in addition to the financial derailment, as a private renter these events threaten the roof over your head.
Our latest polling shows that UK adults renting privately exhibit markers of financial precarity as often or more so than those in other housing tenures. [1] 18% of private renters have used their overdraft in each of the last three months, compared to 12% of the wider population. Meanwhile, 22% of private renters would not be able to pay any of an unexpected cost of £1,000 without turning to borrowing or seeking help from someone else, compared to 15% of the wider population. And with Local Housing Allowance still frozen, there is little support for private renters at the sharp end of the cost-of-living crisis.
The solution: A Tenancy Support Duty
That is why we are calling for a ‘Tenancy Support Duty’ for private sector tenants experiencing rent arrears. This would require a landlord to work together with their tenant to resolve their arrears: by contacting them in good time; signposting to social security support and debt advice, and making reasonable efforts to agree an affordable repayment plan. A judge would have the power to suspend eviction proceedings if landlords have not taken these steps.
Social tenants are afforded support if they fall into rent arrears through the Pre-Action Protocol for Social Landlords, while the Mortgage Charter reflects similar rights for mortgagers to a significant amount of support before they face repossession action. Private renters are unique in their lack of protections, despite increasing likelihood that private tenants will experience financial difficulty or have additional vulnerabilities due to the fall in size of the social rented sector and parallel increase in private tenancies.
This wouldn’t mean that landlords would have to absorb a tenant’s arrears, but that tenants would have the time and space to repay wherever possible. Landlords would still be able to trigger evictions, but only as a last resort if a tenancy is genuinely unsustainable.
Our research shows that some private landlords are already taking the steps outlined above, though in fewer numbers than social landlords. These steps are also endorsed by the National Residential Landlord Association as good practice. But without statutory underpinning, support is patchy and inconsistent, which means that the way a tenant is treated when they fall into rent arrears is at the discretion and good will of individuals. Enshrining these obligations in law would drive up standards and engender a cultural shift that encourages working with tenants.
During a deepening cost-of-living crisis, the Renters’ Rights Bill is a golden opportunity to introduce support to help struggling private renters stay in their homes.
[1] All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,211 adults. Fieldwork was undertaken between 9th — 10th September 2024. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+). ONS mid-year population estimate for 2022 estimates there are 53,646,829 adults aged 18+ in the UK.
