Legal concerns continue to mount following the launch of Labour Renters Rights Bill, with growing worries about how the court system will cope.

Greg Simms, Real Estate Disputes Partner at large firm Addleshaw Goddard, says: “As widely reported, the Labour Renters Rights Bill removes the ability of landlords to serve section 21 notices.

“The consequence of this will be that Accelerated Possession Proceedings without a court hearing will be a thing of the past. Once the Bill becomes law in spring/summer 2025, the only way to get possession will be through the standard possession procedure, which requires a court hearing.  

“The courts are already struggling to cope with an enormous backlog of possession claims.  Without much needed court reform and investment into the court system, I am concerned about the court’s ability to deal with this increased demand.  This will have an impact on all claims going through the county courts not just the possession claims.

“Given the removal of ‘no-fault’ evictions, landlords will only be able to obtain possession if they can satisfy one of the statutory grounds.  Although the Bill expands the available grounds of possession, there remains a potential issue in relation to Purpose-Built Student Accommodation.

“The Bill introduces a ground of possession allowing landlords to obtain possession of student accommodation between 1 June and 30 September in any year, but this only applies where the dwelling-house is an HMO.  

“PBSA usually falls within an exception to the HMO regime and therefore this ground will not apply to it.  This leaves landlords of PBSA without a route to get possession.  I would hope that this issue is addressed by the government and that the Bill will be amended as it works its way through parliament to deal with it.”

Simms believes there may be legal issues with other aspects of the Bill too.

“There are many other changes brought about by the legislation, including in relation to rent. Contractual provisions in tenancies providing for rent increases will be of no effect.  

“Unless by agreement with the tenant, landlords will only be able to increase rent if they obtain a determination from the Tribunal as to the open-market rent.”

Simms says it remains to be seen the impact that the Bill will have on the market.  

“In my opinion, there is a risk that the reforms will disicentivise investment in private rental properties, particularly for those with small portfolios. Going forward, the sector is likely to only remain accessible to large institutional investors.  

“It will no doubt give tenants more protection, as the government intends, but any reduction in the supply of private rented accommodation is only likely to have the effect of increasing the level of rents.”

Sorry over court delays is also the main reaction from Paul Shamplina, founder of Landlord Action.

He says: “While I support changes such as improvements to property conditions, my main concern is the broken court system. 

“Good landlords will benefit from clearer regulations, but promises of robust eviction grounds mean little if the courts remain overwhelmed. We already have cases where landlords are owed two years of rent but can’t reclaim their properties, with one of our cases dragging on for 19 months without a hearing date yet.

“Landlords aren’t banks, and many rely on rent to cover mortgages or fund retirement. Nearly a fifth of properties for sale are from landlords leaving the market, forcing tenants to find homes in an already tight market. Without landlords, the private rental sector collapses … without fixing the court system, the entire rental market faces chaos.”

The Law Society of England and Wales is also concerned with president Nick Emmerson saying: “As the housing crisis spirals out of control, it is vital that renters are afforded clear rights that protect them from unjust treatment and homelessness. Ending ‘no-fault’ evictions is a critical step in bolstering these protections. 

“However, more details are needed on how the government will ban ‘no-fault’ evictions, while balancing tenant rights with landlords’ routes to repossessions. Maintaining this balance is key in reforming the rental market.

“We also urge the government to invest in both the legal aid system and the courts to ensure renters can access justice and are protected when facing eviction.”

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