What impact will the Renters’ Rights Act have on homelessness?
By Lindsay Johnson
One of the principal policy drivers behind the abolition of assured shorthold tenancies was the contribution of “no fault” eviction to the number of homeless applicants. The statistics bear that out in part: in 2024/25, 38% of those owed the prevention duty under section 195, Housing Act 1996, were threatened with homelessness due to an assured shorthold tenancy ending; 12% of those owed the initial duty under section 189B were homeless due to the end of an assured shorthold tenancy. On the flip side, the private rented sector is essential to local housing authorities being able to meet their statutory obligations: 28% of those housed under the relief duty were housed in the private rented sector.
The changes made to the private rented sector by the 2025 Act will therefore affect both the number of applicants and the manner in which the duties owed to them will be discharged.
Homelessness and threatened with homelessness
A person is currently threatened with homelessness if they have been served with a section 21 notice and that notice will expire in 56 days (section 175(5)). By paragraph 6.35 of the Code of Guidance, the Secretary of State takes the view that it is not reasonable to continue to occupy accommodation after the expiry of a section 21 notice if the local authority is satisfied that the landlord intends to pursue possession, i.e. a person is homeless on the expiry of the section 21 notice.
Paragraph 48 of Schedule 1 to the 2025 Act amends section 175(5) to provide that a person is threatened with homeless if they have been served with a section 8 notice and the date specified in that notice is within 56 days.
This is likely to mean that every assured tenant who receives a section 8 notice will, by the point of making an application under Part 7, be threatened with homelessness and therefore owed the assessment and planning duties under section 189A and the prevention duty under section 195. By definition, their cases will be more complex than those of applicants whose homelessness is due to the end of an assured shorthold tenancy – there will be questions of fault and an enhanced need for investigation and inquiry.
The amendments to the Code of Guidance are not yet available. Given that paragraph 6.35 was introduced in order to prevent a tenant remaining in accommodation that they could not afford or was not otherwise unsuitable until the date of eviction, it seems difficult to reason why a similar provision should not apply to an assured tenancy.
Use of the Private Sector
The private rental sector is of central importance to local housing authorities when discharging their homelessness functions. Since 2011, local authorities have been able to compel those owed the main housing duty under section 193, Housing Act 1996, to accept what is known as a Private Rented Sector Offer, i.e. an offer of an assured shorthold tenancy for a period of not less than 12 months, pursuant to arrangements made by, and with the approval of, the local authority (section 193(7AA)). An applicant made unintentionally homeless from a PRSO within 2 years could reapply to the authority without the need to establish priority need (section 195A). The provisions relating to PRSOs are fiendishly complicated and require strict adherence to the statutory and regulatory regime – see Norton v Haringey LBC [2023 ] EWCA Civ 1340 [63].
The same approach to the use of the private sector was applied in the changes made to Part 7 by the Homelessness Reduction Act 2017. Not only can the initial duty under section 189B be brought to an end by refusal of a Final Accommodation Offer (essentially, a PRSO by another name), that refusal also prevents the applicant ever being owed the main housing duty.
In the context of a rampant housing shortage, those powers have proved invaluable. In the financial year ending March 2025, PRSOs accounted for 10% of all cases where the main housing duty was brought to an end. In the same period, Final Accommodation Offers were the method by which the initial duty was brought to an end in more than 33% of all cases.
With the abolition of assured shorthold tenancies, both PRSOs and FAOs require amendment. To that end, section 25 of the Renters Rights Act 2025 makes amendments to section 193 in order to confirm that a PRSO is now an offer of an assured tenancy rather than an assured shorthold; Schedule 2 makes like provision in relation to FAOs.
The right in section 195A to reapply within two years without establishing priority need has also been removed. It is not entirely clear why that is necessary: if the intention behind section 195A is to allow for the fact that a PRSO may not “work out” for the homeless person and to compensate for placement in the private sector rather than the public sector, the changes to security of tenure made by the 2025 Act do not affect that intention. A homeless applicant may be equally unable to manage an assured tenancy as they were to manage an assured shorthold tenancy. Be that as it may, any applicant offered a PRSO will now have to establish priority need on any subsequent application.
Outside of PRSOs, an authority may currently discharge into the private sector where an applicant “accepts an offer of an assured tenancy (other than an assured shorthold tenancy) from a private landlord” (section 193(6)(cc)). The 2025 Act deletes that method of discharge. It is not immediately clear what the effect of this is. While section 193(5) permits an authority to discharge by way of an offer that is neither made under Part 6 nor a PRSO, it is questionable whether this provides a mechanism for discharge into the private sector: if an authority can discharge by way of an offer of an assured tenancy under section 193(5), the PRSO-regime has no relevance post-2025 Act and has arguably never had any relevance.
Other changes
Under the current law, an applicant who deliberately and unreasonably refuses to take a take a step that has been identified in a Personal Housing Plan will, following a warning, cease to be owed the initial duty under section 189B and the main housing duty (section 193C(2), (4)). The 2025 Act limits those consequences to simply no longer being owed the initial duty; the main duty will continue to apply.
