Renters’ Rights: Could rent disputes now be resolved in just a week?
While the landlord database stole the headlines, the Government has also – in line with NRLA recommendations – announced that the Valuation Office Agency will be able to rule on rent increases. But what does this mean for you? Our head of compliance James Wood explains more.
New powers, allowing the Valuation Office (VOA) to rule on challenges to Section 13 rent increases were made public earlier this month, but were largely overshadowed by the Government announcement on the landlord database.
Changes to the way the system works were brought in under the Renters’ Rights Act earlier this year to give tenants greater powers to challenge rent increases.
During our conversations with Government as the Act was making its passage through Parliament, we supported a number of amendments to direct rent challenges away from First-tier Tribunal (which deals with them at present), in a bid to speed up the process and free up tribunal time.
And we are delighted the Government has, finally, listened.
The move will not only reduced pressure on the Tribunal – it also has the potential to slash waiting times from the current three months to a matter of days.
Evidence from north of the border
Rents in Scotland are sent first to Rent Services Scotland, the Scottish equivalent of the VOA. Only if the tenant or the landlord wants to appeal will it then move into the Tribunal system.
Almost no cases go on to the Tribunal after this first step, with the Tribunal hearing only one or two cases a month.
This process appears to be substantially faster at providing a rent determination than the Tribunal alone.
Data from a Freedom of Information request submitted to Rent Service Scotland by the NRLA in 2024 showed that, in Scotland, it typically takes between one to three weeks to receive a rent determination.
That is compared to recent figures from Hamptons suggesting the First-tier Tribunal – responsible for adjudicating on rent increases in England – is currently taking three months to make a decision.
While this has fallen from between five and six months at the start of the year, following a recruitment drive in the courts, it is still far too long.
This is not least as any decision cannot be backdated, meaning that even if the tribunal finds in your favour back payments will not be made.
This, in turn, means there is little to deter tenants from putting forward a challenge to any proposed increase. This is already being seen in the figures, with 166 cases decided in July this year, the highest number on record.
Indeed, 73% of all tribunal decisions made by August involving applications submitted on or after 1st May when the new rights were introduced.
Where does the VOA come in?
As mentioned earlier, we supported a number of amendments that would redirect rent challenges away from the courts during the Act’s passage through Parliament, including one tabled by Baroness Wolf of Dulwich which would have required applications challenging rent increases to be reviewed by the VOA in the first instance. This sought to establish a pre-appeal assessment process to filter out cases with no prospect of success and avoid over-burdening the tribunal.
There were a couple of reasons we backed such a move.
Firstly, to avoid logjams in the courts caused by the predicted increase in challenges, and secondly because - as the Valuation Office already collects extensive rent data as part of its general duties - it is perfectly placed to provide accurate market rents in a timely fashion.
We are delighted that housing minister Matthew Pennycook has finally listened, and agrees with us that the changes will mean challenges to proposed rent increases will be determined faster, at the same time reducing pressure on the tribunal system.
When will this change happen?
The change will require new legislation, with the Government expecting it will take up to two years to transfer responsibilities from the tribunal to the VOA and, as yet, there has been no information as to when this process will begin.
In the meantime, we will be liaising closely with government and monitoring the performance of the tribunal to ensure rent increases are dealt with swiftly and fairly.
Is there anything I need to do now?
Ahead of these changes coming in, we would remind you to ensure you have robust evidence to back up any proposed rent increase you wish to introduce, in line with the current rules. You should also make sure the figure you suggest is based on recentlyachieved local rents – which are distinct from ‘advertised rents’ seen on portals like Rightmove and Zoopla.
This could mean collecting evidence from local letting agents renting out similar properties, or citing evidence from your own portfolio.
You also need to think about the condition of your home, with a number of recent decisions setting amounts below local market rate, as it was deemed the property in question was not up to scratch.
More information
- For full guidance on rent increases, including free Section 13 completion notes and letter templates for members click here.
- For all the latest on Renters’ Rights you can access our exclusive members’ hub here.
- For the latest on the landlord database click here. You can also use our exclusive tracker tool to work out when you and your properties will be impacted by the regional rollout.
- Our award-winning training academy runs a comprehensive Renters' Rights Act training offer. Click here to book your place.
