This applies to England only
Currently the landlord or agent tends to offer a tenant a fixed term tenancy for six or twelve months. The Department of Levelling Up, Housing and Communities have suggested that following the Renters’ Reform proposals going through, all tenancies will be periodic from the beginning. A tenancy must be in writing and a tenant would be required to give two months’ written notice instead of one month currently.
This gives tenants more flexibility to end a tenancy, which can be for many reasons, job relocation, need to move back home, if the tenant is not happy in the property or the landlord has not investigated or completed any maintenance repairs that have been reported. Currently if the tenant is in a fixed term, regardless of their circumstances or reasons, they cannot end the tenancy early unless by agreement with the landlord and may be liable to pay for an early release which will include some or all of the landlord’s re-letting costs.
It is not clear how this could affect a guarantor, as currently if a tenancy is periodic a guarantor can give notice to end their responsibilities. Which is why we would recommend always keeping a tenant that has a guarantor on a fixed term.
Equally if rent is paid upfront, if a tenant ends the tenancy before the end of the upfront rent period, then the excess rent would need to be repaid back to the tenant. It is yet to be confirmed but it has been suggested that upfront payments may be limited.
Rent will only be allowed to be increased annually. Rent increase clauses will be removed from the tenancy agreement which means the only way a rent increase can be enforced is by serving a section 13 which must be a minimum of two months’ notice.
If a tenant is not happy with the proposed rent increase they can apply to the First-tier Tribunal (FtT). The FtT currently has the power to increase, decrease or agree to the rental amount requested. However, it has been suggested that if the tenant applies to the FtT for a rent review the FtT will not be able to increase the rent higher than the landlord was proposing. Therefore, if the tenant appeals to the FtTthere is no risk to them.
A landlord may incur a rent repayment order if the property they are letting is a non decent home. A superior landlord (rent to rent scenario) may also be liable. A tenant will be able to leave if the property is a non decent home
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