The first section of the Bill is very clear - there shall be no new fixed term tenancies for assured tenancies. Assured tenancies are those whose rent falls within the relevant limits - not less than £250 pa and not more than £100,000. This covers all but a few tenancies.
The relationship of landlord and tenant is created when both parties voluntarily enter into a contract where one party offers a property to the other in exchange for rent. The landlord does his due diligence and lets to the tenant. The landlord may consider the tenant is a risky investment because of, say poor credit history or they are unable to work because of an injury, but nevertheless decides to grant the tenancy on the basis that the tenant has offered significant rent in advance and, possibly also a guarantor. If the tenancy agreement is entered into it follows that both parties must have been content to enter into the landlord/tenant relationship.
In this example the landlord has to date had his concerns about the tenant's ability to perform his obligations addressed by two solutions, one of which is to pay a significant rent in advance, which will be taken away from landlord when the legislation comes into force.
Now consider this scenario. A child, or young adult, has suffered a catastrophic injury as a result of someone else's negligence and needs special care, both physical and mental, and is wheelchair bound. Their existing home is woefully inadequate to house them, their family and carers, and cannot be modified. For example, the family live in a flat in a former house that has been converted into three flats. So, they need to find a property to rent in the short term until the inevitable litigation plays out. They do not have the funds to purchase a suitable house straight away but have secured interim payments to enable them to look for a suitable rental property and to pay for adaptations.
From the landlord's perspective the request not just to rent a property but to undertake adaptation work is unusual and many will simply not countenance such a proposition. Fortunately, others will; but almost always with conditions. They want the security that the tenant is going to remain a tenant for a sufficiently long period to make the alterations worthwhile. Indeed, the tenant wants the security that they cannot be evicted after 12 months because the landlord wants to sell or move his family into the house. In other words both parties want a fixed term tenancy as they both want the security. For the tenant the priority is accommodation for a minimum period, in many cases at least 2 to 3 years, in what is an exceedingly difficult time for the family and, for the landlord, the security that the rent will be paid.
The tenant in the majority of the cases able to offer rent in advance, often 12 months and sometimes 24 months. The tenant has these funds and they are available to be used for rent, and pay for the adaptations, and it helps persuade the landlord to enter into the tenancy agreement. Once the Bill becomes an Act there will no longer be an option of paying more than one month's rent in advance. Indeed, the Bill expressly defines such payment as a prohibited payment with the penalty that flows from the Tenant Fees Act 2019.
However, this is not the end of the problem. Whilst in many, but not all, cases the tenant will agree to reinstatement at the end of the tenancy, the landlord still faces risk. To accommodate the risk the tenant will not have the funds to put back the alterations the obvious amelioration of the risk was a larger deposit. This has not been available for many years. In some cases, part of the solution is a higher rent. Under the new rules the landlord will not be allowed to ameliorate this risk as they will not be allowed to increase the rent above the level advertised. This both methods of finding a solution are now removed.
In short, the Bill takes away the tools the landlord is able to use to reduce the risk they are taking when letting a property in such circumstances. The likely consequence is that fewer landlord's will be willing to enter into tenancy agreements with this small but important group of people.
The Bill also takes away for tenants the security of knowing that they have a home for a fixed period of time, whilst the litigation plays out.
Assuming the Bill becomes an Act in the next few weeks, as everyone expects, the Government will have made life much more difficult for a small group of people at a time in their life when they most need help and the small pool from which they can obtain that help is likely to diminish even further.
Wilsons has a highly regarded Court of Protection team led by Frances Mayne and this is a very real problem facing the team. The expectation is that it is going to be far more challenging to find suitable accommodation for those whose lives have been so catastrophically changed by someone else's negligence.
Senior Partner and RICS Accredited Mediator
This note is based on the consolidated Bill as amended on report published on 15 July 2025. As the Bill has yet to receive Royal Asset, its provisions may be subject to change.