Renters right bill update
This received its third reading in the House Of Commons in January with 440 MP voting for and 111 against. It then passed the first stage in the Lords and will be debated at the second reading in the Lords on the 4th February. There were a couple of amendments on restricting rent in advance and the role of a guarantor.
The proposed amendment to rent in advance is to be capped to a maximum of one month. This will have an impact on landlords accepting tenants who may not pass referencing in the normal way and accept the added security of rent in advance. The amendment is also suggesting a £5,000 fine by the local authority if a landlord is found to have taken more than one month in advance.
The proposed amendment for guarantors is to cap their obligation to pay any rent in the event the tenant does not pay the rent to six months. They are also looking to amend their responsibility in the event of the tenant dying.
These and others will be debated, but will have consequences where landlords prefer the additional security of a rent in advance or guarantor, when a tenant may not be able to proceed due to bad credit, not enough income, self employed people without 3 years accounts etc.
GOVERNMENT’S DOUBLE STANDARDS WITH SECTION 21!
You seriously couldn’t make this up! The Renters Reform Bill was originally brought in by the Conservative Party and the Labour have continued with this and changed the heading to the Renters Rights Bill. Part of which, the Section 21 has always been on the agenda to ban as they feel it is used to easily by landlords and not fair on tenants. In fact Angela Raynor said she felt Section 21 evictions were a contributing factor to the homelessness!
And yet… The Daily Telegraph has reported that a Labour run council, ‘Lambeth Council’ to be precise has used the Section 21 to nearly 200 people before the bill comes in, to gain the properties back – how can this not be classed as double standards! It will be very interesting to see if they recommend these families to stay put until they have received a court order or bailiff as we all know that is what they usually say and that if they move out prior it would be classed as making themselves voluntarily homeless!
EPC UPDATE
The previous government wanted to impose and EPC rating of C on all rented properties from 2025 for new tenancies and 2028 for existing tenancies, this was put on hold in 2023. Labour are looking to re-introduce this to take affect from 2030!
IN THE COURTS
HMO’s have become increasingly popular over the years, especially those that have decorated to a high standard, giving almost hotel standard rooms with en-suites. The landlord undoubtably receives more money than renting the property out as a whole and tenants are able to rent lovely rooms at a much reduced price without very often the added costs of utility bills. BUT… if the landlord is not doing their due diligence regarding Right to Rent checks, HMO licensing rules etc, they can easily fall foul of the law and land themselves with hefty fines, rent repayment orders and struck off for being a landlord in the future. Here are a couple of examples.
£20,000 FINE FOR LANDLORD
A landlord was ordered to pay back to 3 of his tenants a rent repayment order of nearly £20,000 for breach of the HMO licensing rules. This was due to renting to 3 individual people, thus making the property a HMO to which the landlord claimed he was unaware that he needed a license, the property had a Category 1 hazard for excess cold, inadequate fire safety arrangements (required under the HMO License) and one of the rooms being too small. The landlord had claimed ignorance of the rules, to which the judge ruled was not a defence.
£35,000 FINE FOR LETTING AGENT
A Portsmouth letting agency was given a fine of nearly £35,000 and 200 hours of community service, for failing to license multiple properties under the HMO rules. The council became suspicious of overcrowding in the properties and were refused entry by the tenants as they were told by the agency to do. The council then had to gain a warrant from the magistrate court. The director pleaded guilty.
AN OFFER OF ADVICE
We are heading for the major reform in the lettings industry. A good agent will be reading and monitoring and ensuring their clients are safe. It is becoming harder and harder for landlords to self-manage, (unless they consider it their job and regularly attend courses). To be frank, one fine from the council, could easily cost a lot more than if you had engaged an agent to manage the property.
At Move On, we are always attending courses to ensure we are abiding by the rules and safe-guarding our clients. If you have considered looking for an agent, then give me a ring and I will personally happily chat through any concerns or questions you may have.
Sharon
CONTACT
T. 01202 711169
A. 420 Poole Rd, Branksome, Poole BH12 1DF