Rent regulation in England and Wales

Last updated December 09, 2019

Rent regulation in England and Wales is the part of English land law that creates rights and obligations for tenants and landlords. The main areas of regulation concern,

the mechanisms for regulating prices (historically called "rent control"). Since the Housing Act 1980, prices are generally left for landlords to fix.
the reasons that a person can be evicted. Since the Housing Act 1996, most tenancies can be terminated on their expiry for any reason.
the obligations to repair and maintain the property under the Landlord and Tenant Act 1985.

In general, people renting homes or real property may agree with a landlord to any contract terms they like, but some rights and duties are made compulsory. Historically, the United Kingdom sought to ensure fair rents, prevent evictions without a fair reason, and placed obligations on landlords to properly maintain premises. Such regulation seeks to redress the inequality of bargaining power between landlords and tenants in a market where there is unlimited freedom of contract. Most rights for tenants were abolished by the Housing Act 1980 and in subsequent legislation through the 1980s. The remaining legislation is found in the Landlord and Tenant Act 1954, which gives rights to business tenants, and the Landlord and Tenant Act 1985 which gives some rights, although fewer, to people renting for the purpose of a home.

History

"As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed, and demand a rent even for its natural produce. The wood of the forest, the grass of the field, and all the natural fruits of the earth, which, when land was in common, cost the labourer only the trouble of gathering them, come, even to him, to have an additional price fixed upon them. He must then pay for the licence to gather them; and must give up to the landlord a portion of what his labour either collects or produces. This portion, or, what comes to the same thing, the price of this portion, constitutes the rent of land ...."

Adam Smith, The Wealth of Nations (1776) Book I, ch 6

Before the 20th century, and during the industrial revolution, the regulation of the rental property relationship was largely left to the market. The first major regulation was introduced by the Rents and Mortgage Interest Restriction Act 1915, largely as a consequence of rent strikes in Glasgow.

Regulation

Tenancy contract

Marchant v Charters [1977] 1 WLR 1181, Lord Denning MR, a person has a lease when the occupant had a ‘stake in the room or did he have only permission for himself personally to occupy’ it?
Johnson v Moreton [1980] AC 37, 66, Lord Simon, ‘There was one economic and social relationship where it was claimed that there were palpably lacking the prerequisites for the beneficent operation of laisser-faire - that of landlord and tenant. The market was limited and sluggish: the supply of land could not expand immediately and flexibly in response to demand, and even humble dwellings took more time to erect than those in want of them could spare. Generally, a man became a tenant rather than an owner-occupier because his circumstances compelled him to live hand-to-mouth; the landlord’s purse was generally longer and his command of knowledge and counsel far greater than the tenant’s. In short, it was held, the constriction of the market and the inequality of bargaining power enabled the landlord to dictate contractual terms which did not necessarily operate to the general benefit of society. It was to counteract this descried constriction of the market and to redress this descried inequality of bargaining power that the law - specifically, in the shape of legislation - came to intervene repeatedly to modify freedom of contract between landlord and tenant.’
Bankway Properties Ltd v Pensfold-Dunsford [2001] 1 WLR 1369, Arden LJ, [42]-[44]

Right to repairs

Bruton v London & Quadrant Housing Trust [1999] UKHL 26
Landlord and Tenant Act 1985

Security of tenure

Security of tenure exists for business tenancies under the Landlord and Tenant Act 1954. It was abolished for most residential properties by the Housing Act 1988. However, it remains for some people who live in council houses.

Rental price controls

The Rent Act 1977 was the last piece of legislation in England and Wales to place limits on how much landlords could raise prices for residential homes. It was substantially repealed by the Housing Act 1988.

Regulators and Ombudsman

The Property Ombudsman

Notes

Related Research Articles

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A lease is a contractual arrangement calling for the lessee (user) to pay the lessor (owner) for use of an asset. Property, buildings and vehicles are common assets that are leased. Industrial or business equipment is also leased.

A leasehold estate is an ownership of a temporary right to hold land or property in which a lessee or a tenant holds rights of real property by some form of title from a lessor or landlord. Although a tenant does hold rights to real property, a leasehold estate is typically considered personal property.

Rent control in Ontario refers to a system of rent regulation in Ontario, Canada which limits the amount by which the rent paid by tenants for rental accommodation can increase.

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Landlord harassment is the willing creation, by a landlord or his agents, of conditions that are uncomfortable for one or more tenants in order to induce willing abandonment of a rental contract. Such a strategy is often sought because it avoids costly legal expenses and potential problems with eviction. This kind of activity is common in regions where rent control laws exist, but which do not allow the direct extension of rent-controlled prices from one tenancy to the subsequent tenancy, thus allowing landlords to set higher prices. Landlord harassment carries specific legal penalties in some jurisdictions, but enforcement can be very difficult or even impossible in many circumstances. However, when a crime is committed in the process and motives similar to those described above are subsequently proven in court, then those motives may be considered an aggravating factor in many jurisdictions, thus subjecting the offender(s) to a stiffer sentence.

The Landlord and Tenant Act 1954 is an act of the United Kingdom Parliament extending to England and Wales. Part II of the act is a statutory code governing business tenancies. Part I of the act, which deals with the protection of residential tenancies, is now largely superseded.

An assured tenancy is a legal category of residential tenancy to an individual in English land law. Statute affords a tenant under an assured tenancy a degree of security of tenure. A tenant under an assured tenancy may not be evicted without a reasonable ground in the Housing Act 1988 and, where periodic changes in rent are potentially subject to a challenge before a rent assessment committee.

The Landlord and Tenant Act 1985 is a UK Act of Parliament on English land law. It sets bare minimum standards in tenants' rights against their landlords.

Bruton v London and Quadrant Housing Trust[1999] UKHL 26 is an English land law case that examined the rights of a 'tenant' in a situation where the 'landlord', a charitable housing association had no authority to grant a tenancy, but in which the 'tenant' sought to enforce the duty to repair on the association implied under landlord and tenant statutes. The effect of the case is to create the relationship of de facto landlord and tenant between the parties.

Street v Mountford[1985] UKHL 4 is an English land law case from the House of Lords. It set out principles to determine whether someone who occupied a property had a tenancy, or only a licence. This mattered for the purpose of statutory tenant rights to a reasonable rent, and had a wider significance as a lease had "proprietary" status and would bind third parties.

Landlord–tenant law is a part of the common law that details the rights and duties of landlords and tenants. It includes elements of both real property law and contract law.

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The Ellis Act is a 1985 California state law that allows landlords to evict residential tenants to "go out of the rental business" in spite of desires by local governments to compel them to continue providing rental housing.

The history of rent control in England and Wales is a part of English land law concerning the development of rent regulation in England and Wales. Controlling the prices that landlords could make their tenants pay formed the main element of rent regulation, and was in place from 1915 until its abolition by the Housing Act 1988.

In England and Wales, a section 21 notice, also known as a section 21 notice of possession or a section 21 eviction, is the notice which a landlord must give to their tenant to begin the process to take possession of a property let on an assured shorthold tenancy without providing a reason for wishing to take possession. The expiry of a section 21 notice does not bring a tenancy to its end. The tenancy would only be ended by a landlord obtaining an order for possession from a court, and then having that order executed by a County Court bailiff or High Court enforcement officer. Such an order for possession may not be made to take effect earlier than six months from the beginning of the first tenancy unless the tenancy is a demoted assured shorthold tenancy. If the court is satisfied that a landlord is entitled to possession, it must make an order for possession, on a date no later than 14 days after the making of the order unless exceptional hardship would be caused to the tenant in which case possession may be postponed to a date no later than six weeks after the making of the order. The court has no power to grant any adjournment or stay of execution from enforcement unless the tenant has a disability discrimination, public law or human rights defence, or the case is pending an appeal.

Rent control in Scotland is based upon the statutory codes relating to private sector residential tenancies. Although not strictly within the private sector, tenancies granted by housing associations, etc., are dealt with as far as is appropriate in this context. Controlling prices, along with security of tenure and oversight by an independent regulator or the courts, is a part of rent regulation.

The Landlord and Tenant Board is an adjudicative tribunal operated by the government of Ontario that provides dispute resolution of landlord and tenant matters under the Residential Tenancies Act, 2006. It is one of the eight social justice tribunals in Ontario.

Rent regulation is a system of laws, administered by a court or a public authority, which aims to ensure the affordability of housing and tenancies on the rental market for dwellings. Generally, a system of rent regulation involves:

The Housing Act 1988 is an Act of Parliament in the United Kingdom. It governs the law between landlords and tenants. The Act introduced the concepts of assured tenancy and assured shorthold tenancy. It also facilitated the transfer of council housing to not-for-profit housing associations.

References

R Arnott, ‘Time for Revisionism on Rent Control?’ (1995) 9(1) Journal of Economic Perspectives 99
A Anas, ‘Rent Control with Matching Economies: A Model of European Housing Market Regulation’ (1997) 15(1) Journal of Real Estate Finance and Economics 111–37
S Bright, "Avoiding Tenancy Legislation: Sham and Contracting Out Revisited" [2002] CLJ 146
S Bright, Landlord and Tenant Law in Context (2007)
T Ellingsen and P Englund, 'Rent regulation: An introduction' (2003) 10 Swedish Economic Policy Review 3
M Haffner, M Elsinga and J Hoekstra, 'Rent Regulation: The Balance between Private Landlords and Tenants in Six European Countries' (2008) 8(2) International Journal of Housing Policy 217
H Lind, 'Rent Regulation: A Conceptual and Comparative Analysis' (2001) 1(1) International Journal of Housing Policy 41
C Rapkin, The Private Rental Housing Market in New York City (1966)
G Sternlieb, The Urban Housing Dilemma (1972)
P Weitzman, 'Economics and Rent Regulation: A Call for a New Perspective' (1984-1985) 13 NYU Review of Legal and Social Change 975-988

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