Tenants are quitting tenancies early believing the Renters’ Rights Bill is already law

There appears to be a growing misconception among tenants that the Renters’ Rights Bill is already law to trigger a surge in early tenancy terminations.

That’s the warning from Propertymark Past President Greg Tsuman who says the misunderstanding is driving tenants to invoke early surrender agreements.

They are doing so believing they can legally exit a tenancy with just two months’ notice.

Tenancies can’t be ended currently with two months’ notice until the Bill becomes law.

Tenants believe Bill is now law

Mr Tsuman says that many tenants already believe that the Renters’ Rights Bill is law, and he points to a rise in early surrender agreements stemming from this confusion.

These agreements allow tenants to exit fixed-term contracts early, but they expose landlords to financial risks.

While the Bill aims to bolster tenant protections, Mr Tsuman also warns that it may inadvertently shrink the private rental sector.

Tenants get freedom

He says: “Because the Renters’ Rights Bill means that any tenant can leave a fixed-term tenancy with two months’ notice, this may give tenants more freedom of movement without any fees, but it will also increase landlords’ costs.”

He adds that the extra financial burden could lead to landlords selling up and leaving the PRS.

Consider early surrender agreements

Mr Tsuman is advising landlords to approach early surrender agreements with caution until the Bill becomes law.

He said: “In the meantime, there must be a valid reason why landlords may want to waive their rights before they lose their rights.”

For instance, landlords planning to sell properties might find early surrenders advantageous.

Tenants may act unreasonably

However, he warns of risks, including potential fines, revenue losses and unforeseen expenses.

Mr Tsuman said: “We have seen tenants turn on their landlord as soon as the early surrender agreement was signed.

“Once tenants are no longer contractually bound, some may feel emboldened to act unreasonably or even make threats.

“It’s a good reminder to document everything and, where possible, ensure mutual surrender terms include clauses about post-surrender conduct or settlement of disputes.”