The news this week that even individual private landlords must join a redress scheme is just the latest in an onslaught of laws and regulations aimed at tightening up the private rental sector.
We all welcome better housing conditions and more responsible letting agents and landlords but is the balance now completely unfair? Are agents and property investors just the whipping boys for a government hell-bent on making it increasingly difficult for individuals to operate buy to let?
Most of all, is it time to redress the balance by instigating a register of rogue tenants - are they as big a problem as the rogue agents and landlords that the government speaks about?
We’ve asked a panel of lettings industry experts for their views - and they don’t pull their punches.
These are the big issues confronting the industry today: we hope you will add your views below.
Lisa Simon, head of residential, Carter Jonas:
The introduction of a rogue tenant database could bring a wealth of benefits for landlords, tenants and agents alike, providing a means of protecting all parties from common problems such as subletting, rent arrears or refusal to vacate a property.
There are a number of tenants out there – particularly in London – who sublet properties repeatedly. In many cases, such tenants not only sublet, but often fail to pay their rent and fall into arrears, which can prove costly for landlords.
Such instances should be reported onto a database to curtail ongoing offences – and to deter offenders. Tenants who refuse to vacate a property when served notice, and specifically in cases where a Section 21 notice has been served correctly and the tenant is in breach, should also be recorded on such a register.
Local councils would be best placed to run a rogue tenant database; however, they would require access to associated court rulings in order to operate this effectively. Should such a register ever come to fruition, the intention should not be to enforce further regulations, but to ensure that the law effectively protects good tenants, honest landlords and reputable agents.
Isobel Thomson, chief executive officer of the National Approved Letting Scheme (NALS):
NALS wants to see a safe and secure Private Rented Sector for all - tenants, letting agents and landlords. We're not in favour of blacklisting tenants on a database.
We think it's much more important to encourage responsible behaviour and ensure tenants are aware of their rights, but also their responsibilities.
This guidance is what a professional agent can provide.
Rather than a bad tenant database, we'd like to see more widespread use of rental payment history schemes and the use of external referencing companies.
Neil Cobbold, chief operating officer of PayProp UK:
A rogue tenant database might seem like a logical next move for the industry – after all, there are already databases covering rogue landlords and agents. But is there a real need for one covering tenants too?
Currently, bad tenants are likely to have a poor credit record if there is a Section 8 eviction and money judgment against them, making it easy to identify bad tenants on that score. Another concern with a tenant database is that it becomes another industry knowledge base to maintain, and another potential check to pay for when vetting a prospective tenant.
What’s included in such a database and who maintains it is another question that must first be resolved. With the rogue landlord and agent database, only those who have been successfully prosecuted end up on the database. So, if a tenant equivalent is to be created, it would need to be along the same lines.
If a rogue database was to go ahead, it would also need to include all evictions undertaken through Section 8, including anti-social behaviour or property damage, otherwise it would just be a repeat of the money judgments already available through a credit check.
Creating a rogue tenant database could potentially make landlords and agents look like bullies, but it depends on how it is structured and the benefit to tenants.
Similar to letting agents and landlords, most tenants are good and law-abiding citizens and won’t be negatively affected. However, there could be benefit for them: If a rogue tenant database can help reduce the tenant referencing costs borne by landlords, and therefore the rent paid by law-abiding tenants, it could be a good thing for the industry.
Ian Wilson, chief executive officer of The Property Franchise Group:
Martin & Co built its own tenant referencing solution a few years ago, so we know a bit about the subject.
The crux of the problem is that it is not financially rewarding for agents and their landlord clients to pursue tenants who have defaulted or caused damage to the extent of obtaining a court order against them.
It takes time, involves cost, has uncertain outcomes and the courts impose derisory payment plans which are themselves often unenforceable in reality. Therefore, lots of badly-behaved tenants do not have a CCJ against their name, and unless you trace their every previous rental address and get an honest reference you won’t discover their misdemeanours.
The most common applicant fraud is to ‘miss off’ a previous address where bad credit is recorded. So, it’s really important that your referencing company links all of the associated addresses and not just the ones that the applicant has declared.
The challenge is, if there is not a formal record, how can you justify making a decline decision based on a ‘secret’ register of alleged misdemeanours?
Alexandra Morris, managing director of MakeUrMove:
Currently the only way to determine whether tenants have previously caused significant costs for letting agents or landlords is through running a credit check and looking out for any CCJs.
We’ve had experience of landlords choosing the quicker route of Section 21 in order to gain repossession of their property, and then not going on to pursue tenants for recoupment of unpaid rent. A rogue tenant database would hugely eliminate this risk.
I would even suggest going one step further and naming the local authorities or departments who encourage tenants to occupy a property until the bailiff stage as they are in part responsible and seen to condone these rogue practices.
There are many factors to consider for when a tenant should be included on the database. These include rent arrears, subletting without permission, which can put the landlord at risk of breaching statutory obligations by overcrowding, making fraudulent claims for benefits, significant property damage and bailiff accompanied eviction.
There would need to be a panel made up of industry representatives to provide views for all parties in the process, such as tenants, landlords, agents, and representatives from the deposit scheme, referencing, insurance, and legal, as well as a government minister.
Part of the planning would require diligence in GDPR and exploration of rights to process and store data in this way. Access to such a database would also need to be considered, with measures to police this and licenses granted to permit access determining exactly who, how and when access may be provided.
If the database was properly managed, it would provide a more balanced view on what is actually going on in the PRS. It would also be beneficial for it to include more detailed information on how local authorities deal with non-paying tenants, which in return would highlight the actual costs incurred by private landlords.
The government would then be forced to consider how best to deal with these evidenced issues in the private rental sector.