The spite and division in the Renters’ Rights Act?

Hello, The government rightly goes a long way to prevent friction and division in diversity and culture.

However, the Renters’ Rights Act (RRA) has implemented legislation that causes friction and inflames the landlord-tenant relationship. It is hard to see anything other than spite, a lack of awareness and incompetence being the reasons for this. Sadly, the government appears to be using spite as their main motive.

To give the real-life experience of being taken through the rent tribunal process by an aggrieved tenant, prior to the RRA changes.

Firstly, to set the context, whilst there are millions of private rented sector (PRS) tenancies, the government website shows a total of 17k tribunal decisions, so just a tiny percentage of landlords have been through the process, but I am one and here is my experience.

As a landlord in 2023, pre the Renters’ Reform Act, I increased rent from £520 to £600 on a 3-bed modern mews property in Lancashire. I had previously held the rent at £520 for 14 years and had a good relationship with the tenant. The property value at £130k was returning less than 5%.

Things changed when I increased the rent, the tenant refused to pay the increase and took me to a rent review tribunal, which I believe she had to pay for (I think about £47).

I felt that I was raising the rent to well below market, and this was not unfair. For me, the tribunal papers took a few hours of work, and the tribunal process was very slow. I made lots of calls to them to chase progress. The tribunal told me they were understaffed. I think the rent tribunal section had access to two or three staff.

The process took 6 months, from 15th November 2023 to 26th May 2024. The tribunal eventually assessed the rent at £700, which was £100 more than asked for, and they backdated the award to November 15th, so I was awarded £1080 in back rent.

I was awarded £600 more than I had asked for, as I only put the rent up to £600, not £700. Rather than resolve the issue, the friction continued, and the tenant stopped paying rent completely. I issued a Section 8 notice. The eviction was finally granted after many months of delay and was adjourned a couple of times due to the tenant making false claims, which had to be answered. The tenant eventually did a moonlight dash owing rent.

Anyway, under the new spiteful RRA revisions, things would be different.

I now have to give two months’ notice of the rise using the government Section 13 notice. Effectively, the tenant can keep another month’s money before action can be taken. For a London or Manchester property where a landlord may already have capital losses due to devaluation, this could be thousands of additional pounds.

The new government rent rise Section 13 form explains to the tenant that they can object to any rise as late as one day before the rise comes into effect.

So the tenant can delay the start of the tribunal process by two months. The tenant will not have to pay any increase until the process is complete and it won’t be backdated. The tribunal is free for qualifying tenant. This will effectively give all tenants eight months immunity from rental increases and if they “lose” i.e., the rent is assessed as more than current, the rent will only be raised to what is being asked for by the landlord and not the market rent.

Effectively, all tenants are being financially incentivised to object to any rent rise by not backdating it to the effective date of the rise. Why on earth would the rent rise not take effect from the date it was due once it has been assessed as fair?

This legislation can only serve to create friction between landlords and tenants, as it is unfair and spiteful, and that is the last thing a tenant-landlord relationship needs.

Whilst I would consider myself a fair landlord, I am more concerned by other whisperings.

The new tribunal process does not reference market rates and whilst, I have kept rents low to maintain good tenant relations I do increase to market rent when a tenant leaves.

I feel this is fair, but there is a suggestion that the government may implement a policy to link new tenancy rents to old ones. This would prevent me from charging the market rent on a new tenancy.

This would effectively create a pool of cheaper rental properties, but at the expense of landlords who did not charge the market rent. To reward those who increased rents but discriminate against those who did not, does not sit well with me.

I am tempted to put rents up to market rate on the basis that there is a market rate, and why should some tenants pay less than others for the same service? It’s not fair to those tenants who pay the market rent.

The only way to do this effectively would be to put my rents above market rate, and let the tenant object, and the tribunal will set it at the market rent. This will cause friction, but the rent will be set at the correct level as assessed by the market

I feel torn and probably represent many landlords who have a good relationship with tenants that will now be tested because of the government’s interference.

What does the Property118 community think?

Thanks,

Paul