The Housing Act 1988 is one of the key statutes governing property law in England and dictates most of the rights and responsibilities of landlords and tenants.
Prior to 1988, most tenancies were 'protected and statutory', which meant they were heavily weighted in favour of tenants. Under the terms of those agreements, tenants had the right to stay in a rented property indefinitely and could even pass it on to their children or other relatives, meaning it was virtually impossible for landlords to regain possession unless the tenant chose to leave.
As a result, people became less and less willing to let their properties. This, combined with the Thatcher Government's decision to give council tenants the right to buy their homes, meant the need to house more people in a different tenure: The Private Rented Sector (PRS).
To grow the PRS, the government realised new laws were needed to redress the balance and encourage those who did own property to rent it out again. As such, one of the most important things to put in place was an assurance that landlords had the legal right to regain possession of their property if they needed to, along with rights to guarantee that both parties were treated fairly. The proposed laws were passed and the Housing Act 1988 came into force on 15th January 1989, reviving a desperately needed private rented sector. At the same time, assured shorthold tenancy agreements (ASTs) were introduced.
It's a common misconception that many media articles and tenant organisations thought landlords and letting agents were responsible for only having six-month tenancy agreements. Yet it was actually the Housing Act of 1988 which introduced this timeframe - by the government - to enable the growth of the PRS. A fixed period of time which guaranteed lenders the ability to secure a property back should they need to. This enabled their support of Buy to Let mortgages, giving more opportunities for the PRS to grow.
Some landlords and tenants think that the Housing Act is a tenancy agreement, because it sets out each party's statutory rights and legal responsibilities. However, they are two separate things:
Three key areas were dramatically affected by the Housing Act 1988:
(a) Within the first six months of the fixed tenancy (assured shorthold tenancies only), and
(b) Upon service of a notice to increase rent, which can be used by landlords annually to increase the rent after the fixed term has ended
One of the most important considerations for you, as a landlord, is to be sure that none of the clauses in your tenancy agreement breach any of your tenants' statutory rights, as outlined in the Act. If they do, the whole agreement could be rendered invalid, as the Act is a 'ruling law' and can't be superseded.
If you use a letting agent to let and manage your property, they will take care of most of the paperwork on your behalf and shoulder much of the legal responsibility. However, you should still ensure that as well as being aware of the rights of your tenants, you know and understand your rights and responsibilities as a landlord.
With letting agent regulation being proposed by the government, it is essential to ensure your existing agent, or whichever one you choose is a member of already self-regulated ARLA or RICS organisations and has Client Money Protection. If not, they may not be in business for much longer and may go bust, taking your rent with them.
Here are the key responsibilities, although some cross over with other acts such as the Landlord and Tenant Act 1985
The two most significant rights that are granted by the Act concern your being able to enter and regain possession and therefore control of the property, as above, some cross with other Acts.
There are four main instances when you, as a landlord, have the right to enter the property while it's occupied by a tenant:
To be clear, unless there is an emergency and an immediate threat to safety, it is illegal for you to enter the property without the tenant's permission and, other than in the situations outlined above, you will require a court order to gain entry.
Encouraging more people to rent out their properties was the driving force behind the introduction of the Housing Act 1988, which meant it was vital that there was some guarantee of landlords being able to remove tenants and take back their properties as and when they needed to. Under the Act, there are two main routes a landlord can take to regain possession:
The full list of legal grounds can be found here.
The Housing Act 1988 was a 'watershed' moment for the private rented sector, when the pendulum swung from tenants having virtually all the control over a property, to a more equitable situation, where a tenant has the right to live undisturbed in a property, but only for a certain period of time. The law gives them a minimum 6-month period, after which the landlord can regain possession at any time with just two months' notice.
There have been amendments and modifications to the law as laid down by the Act since it was introduced, mainly concerning the responsibility of landlords to protect the health and safety of tenants. These include:
So, while the Housing Act 1988 made important and significant changes to the rights of both parties, those rights were not carved in stone. As time goes on, and the needs of tenants and profile of the PRS continue to change, undoubtedly there will be more amendments to the law.
In Scotland, there has already been a shift to give tenants greater security of tenure with the introduction of the new Private Residential Tenancy, introduced in December 2017 in the form of a model tenancy agreement.
Source: https://www.propertywire.com/news/uk/new-rental-laws-introduced-scotland-biggest-change-generation
https://news.rla.org.uk/hammond-listens-rla-longer-tenancies-another-consultation-enough/
You can read the full Housing Act 1988, together with its amendments and modifications, on the government website.