Abolish Section 21 and introduce new possession grounds for landlords

I think this is the main concern for any of us, but this has been on the cards for several years, which is why we have been strongly recommending landlords get legal expenses and rent protection insurance. 

The reason for this seemingly draconian law change is to protect tenants from unfair treatment by unethical landlords and encourage those people to try to resolve issues. Since you have read this far, you can count yourself out of that group! Unfortunately, you are living in the wake of those that are less conscious of their responsibilities than you are.   

Essentially, we shall still be able to end a tenancy, but we will probably have to show the tenants to have breached the tenancy rules, with an improved Section 8 process to help. Positively one thing has been made clear is that there will be stronger ways of ending a tenancy due to non-payment of rent. 

Modification to section 8

Historically the main way to remove a tenant who is not paying rental has been to issue a Section 8 notice. The flaw with this notice came at the point of the court hearing which meant that if the tenant made sure that they were just less than two months overdue, the hearing would usually not take place. Hence a new court date had to arranged giving the landlord increased court costs. 

What the White Paper seems to be indicating is that the outstanding balance will not be a deciding factor. The tenants’ arrears and pattern of arrears will be.

A spin off issue to all of this is how the courts will be able to manage the change.

The Renters Reform Bill states that the Ministry of Justice and HM Courts County Court bailiffs and Tribunals Service are in collaboration to streamline the process of possession proceedings. They specifically intend to target and eliminate any sources of irritation or delay. The Government intends to bolster and make mediation services more accessible for landlords, in order to ward off avoidable evictions.

How will this affect you?

We will need to see the exact measures that are being proposed but I think the need for legal expenses and rent protection insurance will be a no brainer.

Convert assured and assured shorthold tenancies into periodic tenancies

Any former assured tenants or assured shorthold tenants will be put on a single system of periodic tenancies. When a tenant has decided to leave their tenancy, they will be obligated to provide two months’ notice rather than the one month as it stands today.

There will be six months’ notice before new tenancies move to this, then at least 12 months before existing tenancies are converted to periodic.

How will this affect you?

It will be better as you will be given more notice. However, I can foresee an issue at the point this all changes over as some tenants will not like the fact that they have to give a longer notice. Again more reason to have rent protection covering you as doubtless there will be an issue over the payment of the lasts months rental.   

Notice periods for rent increases to be doubled

At the moment we must give one months’ notice for any rent increase –  this will be increased to two months. 

How does this affect you?

It won’t as we have already started the process of giving your residents two months’ notice of any changes to the rental.  

Also the bill proposes to put an end to rent review clauses (but does allow for annual increases, so we await the detail!). It is aimed at tenants that have been subject to unexpected rent hikes that are disconnected from market values. It also stresses that unjustifiable evictions through raised rent are not acceptable.

How will this affect you?

It won’t as any increase in rental that we propose are based on market conditions at the point we evaluate any increases.   

Extend the Decent Homes Standard to the PRS sector 

Hammer to crack a nut from my perspective, as we only work with landlords that supply safe and decent homes. i.e. if you work with us this will not be an issue as long as you follow our advice. This will protect you from Rent Repayment Orders which would potentially allow your resident to receive reimbursement for rental payments related to substandard homes.  However, if they choose to redefine the ‘Decent Homes’ standard, we will need to look at the implications. 

You will hear talk about enforcement notices, but again theses are aimed at Landlords who are happy to provide poor housing. Not you.

The white paper reconfirmed the Government’s goal of improving as many homes in the private rental sector to EPC Band C as practicable by 2030.

How will this affect you?

If you follow our advice, it won’t. 

Incentivise landlords to accept tenants with pets

This has been all over the news that as landlords we ‘must accept pets’.  Not the case. The wording is landlords “do not unreasonably withhold consent when a tenant requests to have a pet in their home, with the tenant able to challenge a decision.”

We assume that if your lease dictates that there cannot be a pet, this would be a reasonable ground to refuse.

The Government also intends to amend the Tenant Fees Act 2019 to include pet insurance as a permissible charge. In doing so, landlords will be enabled to request pet insurance, ultimately providing protection against any damage inflicted on their property.

As you know I am a firm believer that your residents should be able to have a pet if it is suitable for the property. In 18 years of running a business as an agent we have had a tiny handful of issues where we have had to deal with poor ownership of a pet. So, sorry if you disagree, but I can’t see the issue if the property is suitable for the pet in question. As 75% of applicants want a pet, why would you deny yourself so much of your potential market?

Bans on renting to families with children or those on benefits to be abolished

Landlords and agents will be prohibited from ruling out renting properties to families with kids or those receiving government benefits – ‘No DSS’.

The white paper asserts that, although many landlords offer excellent service to their tenants, evidence has shown that some are placing obstacles in the paths of those receiving benefits or with children seeking rental properties.

Will this affect you?

No – for the last three years we have worked with families and those people on HSA. Our main criteria has always been to find the right home for the people and no different from mortgage providers – to make sure they can afford to live in it.

Introduce a new ‘Property Portal’ to support landlords and improve enforcement

This will be not only information for landlords, but a requirement to upload details of their property along with key documents (we assume safety certificates, EPCs etc). This would be publicly available so tenants and councils can check. Again, details on cost would be helpful!

Councils can use this to target properties and improve enforcement. Councils already have the power to put improvement orders on a property. Cynically it’s a great soundbite, but if the Housing Health and Safety Rating System (HHSRS) bought out in 2004 isn’t working, not sure how this will change the landscape.

Will this affect you?

We shall need to see but only on the subject of cost. The White Paper states:

“That the imposition of ombudsman membership as a necessity for landlords who use managing agents should reduce cases where an agent is attempting to fix a complaint but the landlord refuses to cooperate.”

Again, this does not affect the audience I am writing this update for!  

As your agent we are members of The Property Ombudsman scheme. Also, a licensing scheme for landlords has been in place since 2015 with not an issue.   

New Property Portal for private landlords and tenants

This fresh digital Property Portal has been designed to be a single-entry point which will assist landlords in comprehending and presenting evidence of their compliance with all legal obligations.

Will this affect you?

The precise nature of the portal has yet to be determined, with the Government looking to carry out intensive tests of prospective solutions bolstered by user research and engagement with representative groups for the benefit of tenants, landlords and local councils. Watch this space and don’t hold your breath! 

Take out on the renters reform bill

There are no doubt some scallywags out there, with Shelter & Generation Rent presenting these as the majority of Owners. In the world that I frequent and the people I work for, that is not thecase. We deal with landlords that care and are concerned to provide a safe home for their residents to live in. However, we have seen more ‘professional tenants’ over the last year. They pass referencing well, but then seem to ‘push the envelope’ on the legal system, which can cost a lot of money. In 18 years and many evictions, we have had to physically attend court to get vacant possession just twice, both in the last few months. 

Therefore, I would strongly suggest that you start viewing your landlord legal and rent cover as a definite need rather than an optional extra.