The amendment to the Renters (Reform) Bill has been tabled to ensure people on benefits and families with children are not prevented from renting a home.
Private landlords will still be able to carry out referencing checks to make sure a tenancy is affordable, and still be able to make a final decision on who they let a home to.
This will apply to England and Wales and will be extended to Scotland with a further amendment at the report stage of the bill.
Decent Homes Standard for PRS
A Decent Homes Standard will also be introduced to the private rental sector for the first time, and set a threshold to ensure homes are safe, warm and decent.
Details will be laid out after further consultation to improve the standard of rented homes by 50 per cent by 2030.
Local authorities will be given powers to make sure landlords maintain the decency of rented homes, which will include fines of up to £30,000 or banning orders in the worst cases.
Tenants will also be able to claim back 24 months of rent through rent repayment orders instead of the previous 12.
Councils will also be given the authority to investigate landlords who rent sub-standard homes to help identify, take action and remove them from the sector.
Housing Secretary Michael Gove said: “Everyone deserves a home that is safe, warm and decent. But far too many live in conditions that fall well below what is acceptable.
“As part of our long-term plan for housing we are improving housing standards across the entire private rented sector, while also ending discrimination against vulnerable people and families who are being unfairly denied access to a home.”