Renters’ Rights Bill passes second reading in the Lords

The Renters’ Rights Bill has passed its second reading in the House of Lords and will now go to the Committee stage.

A total of 44 members of the House of Lords spoke at the second reading of the Bill.

Baroness Taylor of Stevenage, Parliamentary Under-Secretary of Housing, who introduced the second reading of the Bill claimed the Labour Party recognises the work of good landlords and landlords will be able to reclaim their properties when they need to.

She said new expanding possession grounds are being introduced and will be as “watertight as possible” and no loopholes for landlords to abuse the grounds.

Baroness Taylor also confirmed that councils WILL have powers to enter a business and possibly a landlord’s home and rental property to ‘gather evidence where required’.

Abolishing fixed term tenancies will create a simpler system

Baroness Taylor also claimed abolishing fixed-term tenancies would create a “simpler system” without tenants being trapped in tenancy agreements.

Many members of the Lords,  also warned of the “unintended consequences” of abolishing fixed-term tenancies arguing it would create chaos for students.

Lord Truscott argued during the debate that most tenants prefer fixed-term tenancies because they offer greater security

He said: “Tenants will have less security, not more, as instead of a one or two-year tenancy, if mutually agreed, landlords will be able to give notice at any time, up to four months if reoccupying or selling their property.

“Why cannot reasonable people agree a fixed term, with a break clause if required? Incidentally, the majority of tenants want fixed-term tenancies.”

The Renters’ Rights Bill will ensure landlords cannot unreasonably deny tenant requests to keep pets in their homes, allowing tenants to challenge unfair decisions.

Labour adds that it understands that some landlords have concerns about potential pet-related damage. To address this, the Bill will permit landlords to require insurance coverage for pet damage.

Baroness Taylor told the debate: “We are committed to supporting responsible pet ownership in the private rented sector. The Bill will ensure that landlords do not unreasonably withhold consent when a tenant requests to have a pet in their home, with the tenant able to challenge unfair decisions.

“We know that some landlords are concerned about potential damage caused by pets. That is why the Bill will allow landlords to require insurance covering pet damage.”

EPC C changes will cost thousands of pounds

Baroness Scott of Bybrook, from the Conservative party, labelled the Renters’ Rights Bill as “counterproductive and will make landlords leave the market.”

Baroness Scott also pointed out that Ed Miliband’s plans to have all homes reach EPC C targets by 2030 could cost the private rented sector £25 billion, an average cost of £5,400 per home.

Ms Scott said of the EPC changes: “This is a cost that many landlords, particularly those with only one or two properties, just cannot take.”

Ms Scott also pointed out that the government’s own impact assessment acknowledges that tenants will face increased costs due to the Renters’ Rights Bill.

The assessment says: “it is likely that landlords will pass through some costs of new policies to tenants in the form of higher rents—to offset those costs and maintain a degree of profit”.

‘Identify and find unscrupulous landlords’

On councils being handed investigatory powers, Baroness Taylor said: “New investigatory powers will make it easier for councils to identify and find unscrupulous landlords.

“Local authorities will be able to request information from third parties and to enter business premises and, I have to say in much more limited circumstances, they may able to enter residential premises to gather evidence where required.

“The new powers contain safeguards to ensure they are used appropriately and proportionately.”

The Lords’ notes state:

The bill would provide a power to require information from third parties such as banks, accountants, and client money protection schemes, as an additional route to get vital evidence to build cases.

The bill will also include the power to enter business premises and — in more limited circumstances — residential premises to obtain on-site evidence. Often essential evidence, such as email exchanges, text messages, bank statements and tenancy agreements, are held on business premises.

Watch a clip below of the Renters’ Rights Bill second reading being introduced by Baroness Taylor

Industry reaction to second reading

Timothy Douglas, head of policy and campaigns at Propertymark, said: “As anticipated members of the House of Lords delved into the detail of the Renters’ Rights Bill and discussed the intended and unintended consequences it will bring. Importantly, many Peers outlined key changes to property standards and the challenges on local authority enforcement drawing attention to the vital role letting agents will play in ensuring education and compliance to tenants and landlords.

“Disappointingly, some Peers have fallen into the trap of not understanding the costs and taxes impacting landlords and seeing rent control as an additional measure to tackle affordability issues in the private rented sector. Similar policies have failed in Scotland and must be, at all costs, avoided by the UK government.

“Sensible amendments were talked about to support student renters, much needed clarity on court reform and the implementation timeline, tackling short term lets and local authority funding as well as practical application of the grounds and amending deposit rules to allow more tenants to rent with pets. These are the areas that the UK government must focus their attention during the remaining stages of the Bill.”

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