Lifetime deposits, abolition of S21 and new possession rights for landlords

by Nick Thompson

15:17 PM, 19th December 2019
About 10 months ago

Lifetime deposits, abolition of S21 and new possession rights for landlords

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Lifetime deposits, abolition of S21 and new possession rights for landlords

Government Press release:

A revolutionary new deal for renters will restore fairness, honesty and transparency to the heart of the housing market, thanks to new proposals unveiled as part of the Queen’s Speech.

Under the plans, millions of renters will benefit from a new lifetime deposit scheme, which will see their hard-earned deposit move with them from property to property – giving tenants more control over their lives and keeping more of their cash in their pocket.

Proposals to abolish no-fault evictions have also been confirmed, meaning landlords will no longer be able to uproot tenants from their homes at short notice and with no good reason – bringing greater security to millions of families who live in rented accommodation.

This will be matched with new powers to strengthen the rights of landlords to gain possession of their property through the courts when they have a clearly valid reason to do so, in order to create a fair market where good and responsible landlords flourish.

The government has also announced plans which will make owning a home more affordable. This includes the new First Home scheme making homes available at a discount for local first-time buyers.

Councils will be able to use housing developers’ contributions to discount homes by 30% for people who cannot otherwise afford to buy in their area. The Affordable Homes Programme will also be renewed, building more homes for rent and delivering a new shared ownership offer.

The Queen’s Speech has also set out further detail for new legislation to bring an end to the unscrupulous practice of unnecessary leaseholds – introducing new laws to ban new houses being sold on a leasehold basis and reducing ground rents for new leases to zero.

Welcoming the Speech, Housing Secretary Rt Hon Robert Jenrick MP said:

“The announcements made in the Queen’s Speech today will empower both home-buyers and renters. The legislation that we will bring forward will provide a better deal for renters through our lifetime deposit scheme while also protecting them from no fault evictions. We will also help first-time buyers get a foot on the property market with 30% discounts for local people and key workers.”

“We are moving forward with legislation to set ground rents to zero, abolish leasehold houses and prioritise the safety of residents with the biggest change to building safety laws for 40 years. I look forward to getting on with this ambitious and exciting agenda.”

Housing

As well as the measures for renters, local first-time buyers and reforms to the leasehold market, the government has also outlined plans to which will ensure any new housing is accompanied by essential infrastructure. A white paper will also be published on reforming the planning system to ensure it works better for the public and small builders.


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Comments

Paul Essex

15:45 PM, 19th December 2019
About 10 months ago

I still can't imagine just how these lifetime deposits can possibly work. We already have to get multiple quotes to justify deductions it all takes time. We have to make deductions for roughly 50% of terminations.

steve p

1:11 AM, 20th December 2019
About 10 months ago

Reply to the comment left by Paul Essex at 19/12/2019 - 15:45
The only way I can see a lifetime deposit working is if there is some kind of third party process, for example some kind of insurance policy between tenancies that will guarantee the new deposit will be x amount even if there are deductions. If there are deductions the tenants will need to make up the shortfall or face being chased by insurance company.

paul robinson

7:47 AM, 20th December 2019
About 10 months ago

The student and young professional shared HMO rental market needs fixed term tenancies and the vehicle of section 21 to accommodate this, plus give sufficient swift support to deal with antisocial behaviour and other matters if occurring in a HMO. Otherwise the other decent tenants would be continued to be affected and ultimately their safe enjoyment compromised by their antisocial housemate, leading to all sort of other issues.

Fixed term tenancies and the great benefit they bring to all parties in shared HMO are too long to list here, but fundamentally provide good quality accommodation to young professionals at a competitive price point, allowing them to save and getting on the property ladder themselves.

The government need look at the very different rental demographic, all across the UK and not as they have done with the tenant fee ban, role out “one size fits all” changes.

The proposed changes will again have a detrimental effect on decent tenants in fairly managed shared HMO’s and completely go against the governments goal of providing good quality shared and safe rental accommodation as a fair price!

The recent S21 consultation completely ignored the HMO shared rental sub market and the Ministry of Housing actually advised that it was more targeted at "single household rentals" and HMO shared rental Landlords would be best to use the "other" box to feed back their response.  

In the following government document, there were an estimated 497,000 HMOs in England and Wales at the end of March 2018. ‪http://researchbriefings.files.parliament.uk/documents/SN00708/SN00708.pdf‬   How is it possible that this ½ a million rentals have not been recognised, or their landlords even encouraged to reply to the consultation?

This is fundamentally a flawed consultation and strongly suspect that the HMO shared rental students and young professional market will not be excluded from the abolition of S21.

Despite the consultation now closed as it a change to primary legislation, would require a vote in parliment.

Would still encourage all landlords to email their MP - once we know who they are.

Also copy in;-

TenancyReform@communities.gov.uk
Eleanor.Millington@communities.gov.uk
john.healey.mp@parliament.uk
james.hall@parliament.uk
john.stewart@rla.org.uk
Policy@landlords.org.uk

Martin Roberts

9:09 AM, 20th December 2019
About 10 months ago

And there are a good few who ask for Section 21 so they can apply to the council.

That will finish.

Rod

9:18 AM, 20th December 2019
About 10 months ago

Bit early in the morning for me - but if section 21 comes in what's the point if having a contract and is it now 6 month or 12 month minimum contracts?

paul robinson

9:26 AM, 20th December 2019
About 10 months ago

Reply to the comment left by Rod at 20/12/2019 - 09:18
The proposal in the consultation was an initial fixed term and then it will just continue. without S21 you would have to go to court to remove your tenant via S8. How long is that going to take and one proposal is that you would have to do the same if you wanted to sell the rental, although unless you have informed your tenant prior to granting a tenancy agreement, you cannot sell within 2 years.

terry sullivan

10:17 AM, 20th December 2019
About 10 months ago

what about probationary tenancies--used is social sector--how do they work?

paul robinson

10:41 AM, 20th December 2019
About 10 months ago

Reply to the comment left by terry sullivan at 20/12/2019 - 10:17
Unsure - if you download the S21 consultation document and search the PDF it may reference those type of tenancies. That said if you search HMO there is absolutely no reference so sadly suspect then consultation could also be ignorant of probationary tenancies

reader

13:21 PM, 20th December 2019
About 10 months ago

I wonder how the abolition could impact on HMOs where there are shared facilities. Considering the interactions of tenants in those HMOs would it not be wise to exclude the prohibition of s21 in shared facility accommodation?

paul robinson

13:38 PM, 20th December 2019
About 10 months ago

Reply to the comment left by at 20/12/2019 - 13:21
Based on experience (when needed) without S21 or the threat of, shared HMO would be a nightmare to manage, plus provide unsafe and unpleasant for tenants.

As HMO are registered it would make perfect sense to exclude them. But can we rely on sense from the government? Shared student rentals were not excluded in Scotland, when their version of S21 was scrapped - those types of rentals are now a nightmare to manage!

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