The Renters’ Rights Bill introduced by the government yesterday aims to bring about comprehensive reform to the buy-to-let market. This long-awaited rental reform has been on the agenda for some time, with previous attempts by the Conservative government coming close to approval before being abandoned due to a general election.

Many of the measures in the new bill align with previous intentions, such as the creation of a landlord’s database and granting tenants the right to request a pet. The abolition of section 21 ‘no fault’ eviction was also expected, with the new bill proposing a mediation system to resolve disputes before they escalate to court.

However, there are some provisions in the bill that may prove to be tougher than anticipated for landlords. All tenancies will now become periodic, allowing tenants to serve a two months’ notice at any time from the start of the tenancy. Landlords will still have the ability to end the tenancy if they wish to sell or occupy the property themselves, but will now need to provide four months’ notice. Additionally, the bill aims to prohibit rental bidding, making it illegal for landlords and agents to accept offers above the advertised rate.

These changes may have implications for the buy-to-let market, potentially prompting more landlords to sell their properties. Data from Rightmove shows a record proportion of properties currently for sale were previously rentals, indicating a trend of landlords exiting the market due to rising costs, taxes, and legislation.

While some sales may be driven by concerns over potential increases in capital gains tax in the upcoming Budget, investors are advised not to make decisions solely based on speculative tax changes. The impact of landlords selling their properties on the rental market remains to be seen, with possibilities of providing more options for first-time buyers or being purchased by other landlords for rental purposes.

The Renters’ Rights Bill signifies a significant shift in the buy-to-let landscape, with potential impacts on both landlords and tenants. It will be interesting to see how these changes play out in the market and what the long-term effects will be on the rental sector.