Here is how I, as both a letting agent and landlord, respond to the recent ministerial statement on the private rented sector.
The Secretary of State for Communities and Local Government, Eric Pickles, has recently provided a written statement on the private rented sector setting out the issues he intends to examine over the coming months.
I am pleased to see a certain amount of forethought from the government. So many of the policies that have affected the private rented sector in recent years seem to have been a poorly thought through surprise.
The result has been months of uncertainty as the detail is clarified or legislation is passed with unintended consequences.
Perhaps this statement means the next batch of “improvements” will be more considered!
There are a few ideas lurking in the document which would be of concern to landlords if they are introduced.
For instance, the Government intends to “consider the scope for requiring landlords to repay rent where a property is found to have serious hazards”.
While I accept there are rogue landlords and dangerous properties, there needs to be clear guidance for landlords on what counts as a serious hazard. Many landlords are not aware of the detail of the HHSRSS or building regulations.
For instance, exterior handrails need to be 1100mm high where there is a drop of greater than 600mm. The balustrades should be close enough together to prevent a sphere of 100mm fitting through.
There are many converted flats in my local area of Southend with a rear staircase down to the garden which fails the hazard test on these counts. If you owned and lived in the property yourself, and weren’t a builder or a letting agent, you would probably not even be aware of these rules.
We provide hazard reports to our landlords which advise them of these problems, but most agents do not. Is this the kind of issue you as a landlord could overlook which may result in lost rent – after it’s too late to rectify the problem?
The point that really raised my eyebrows was that tenants should be able to take action without fear of eviction or harassment. To me, having the right to serve a Section 21 notice as a landlord, to reclaim a property without there being a fault, is a vital safeguard.
A landlord usually has a substantial sum of money invested in the property. If their own circumstances change, shouldn’t they be able to recover the property with reasonable notice without other obstacles?
Also, many experienced landlords will have suffered a tenant who is either deliberately damaging the property in order to get a council house or avoid paying rent. It is hard enough to deal with this, without affording the tenants extra protections.
The ability to reclaim your property also is put in jeopardy by the push for longer-term tenancies.
We manage several hundred properties at Pace and I have never seen a landlord evict a tenant for fun, or because of an annual rent increase. Perhaps the latter happens in London where rents are apparently soaring, but in Southend where rents have been fairly stable we have yet to see this happen.
Landlords evict tenants if they need to sell or move back into their property.
We never know when we might have a change in personal circumstance which might require this. Or we may evict a tenant who is failing to look after the property or pay the rent.
We can have a good relationship with a tenant for a long time but then a change in their situation may result in things going rapidly downhill. You wouldn’t want to have a five-year tenancy then!
Both parties may initially intend for an agreement to be long-term, but anything can happen to change this.
If safeguards are introduced so that a landlord can still evict a tenant, it will be still be harder to do than it is now. However, as acknowledged by the Draft Tenants’ Charter, most tenancies end because the tenant wants to move home, so I really cannot see the advantage to this at all.
The draft tenants’ charter appears to be a very clear and useful document. I am pleased to see there is plenty of advice on responsibilities for tenants as well as their rights. For instance, about being liable for the rent to the end of a fixed term and not holding back the last months’ rent!
Much of this information is contained in the standard tenants’ pack we’ve been giving tenants since 2009 but it would certainly have more clout if it included the government’s logo.
I am pleased to see the Government still plans to introduce compulsory redress schemes for letting agents.
However, I am concerned this will give a false sense of security to some landlords as there are no plans to introduce compulsory Client Money Protection for agents. A redress scheme will be of little use to landlords when the agent has gone bust and disappeared with the deposits and last month’s rent.
The full documents can be accessed here:
https://www.gov.uk/government/publications/draft-tenants-charter-guidance-note-for-discussion
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