Recommendations to government for a post section 21 PRS

Recommendations to government for a post section 21 PRS

9:33 AM, 25th May 2022, About 3 months ago 18

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The Lettings Industry Council (TLIC), formed Theresa Wallace from Savills (UK) Ltd and Kate Faulkner, has released a report which makes recommendations based on the expected changes to be introduced in the Renter’s Reform Bill. The report, released today (25 May 2022), aims to help the Government understand what can work in practice and to encourage a PRS that works for all.

The report considers what changes could be made to smooth the path for the abolition of section 21 notices, improvements to the court process, as well as ways to improve property conditions and help those locked in tenancies and unable to move due to financial constraints.

Some of the report’s key recommendations include:

  • Every tenancy should have a written tenancy agreement in place or at the very least a written Statement of Terms. In the absence of either of these then the Government’s model tenancy agreement should be used as the default agreement.
  • A review of the accelerated procedure is needed to reduce the listing of PRS claims and prioritise these cases so they can be taken out of the system without delay.
  • Clarifying the route for dealing with abandonment cases, enabling a process without recourse to the court to further reduce unnecessary court cases where a tenant has clearly already left the property.
  • Prioritising cases with high or persistent rent arrears, dropping review hearings, and employing more judges will further reduce the workload and strain on the courts.
  • Mediation should be a recommendation in all cases, other than where there is evidence the tenant cannot afford to pay the rent. Costs can be kept to a minimum and could reduce court hearings by up to 25%.
  • Government should consider its own bond/loan solution or finance local authorities to issue their own bond guarantees. This option could be available solely for tenants on Universal Credit and/or in receipt of specified benefits to ensure that the deposit problem is specifically targeted to the right demographic.
  • By embedding use of the Unique Property Reference Number (UPRN) within the Renter’s Reform Bill discrete data points across different existing public and private databases can be joined together. Property safety records can be captured and collated within a property portal, to form one comprehensive safety record delivering a safe property at low cost. A property portal linked to a landlord redress scheme will ultimately provide a Landlord Register enabling direct communication with landlords and education on property safety, legislation and better remote enforcement.
  • A Regulator for Regulation. The sector is like a puzzle with lots of pieces that need to be joined up. A regulator would tie all of the pieces together – tenants need one portal door to enter which then signposts them to where they need to go.

Theresa Wallace, Chair of The Lettings Industry Council (TLIC), said:

“Each year, in an attempt to combat some of the issues experienced in the private rented sector, including sub-standard properties, rogue and naïve landlords, and untrained agents, more and more legislation has been introduced, confusing even diligent landlords with the complexities in providing a rental home.

“So far, these changes to legislation, which often come at a financial cost to the landlord, have just compounded the problems further and is a core reason given for why landlords are exiting the sector, leaving a shortfall of available rental properties.

“As a result, in 2022 we are experiencing the biggest crisis we have seen surrounding the shortage of rental property.  We need to encourage investment into the market and that includes private landlord investment.

“The Renter’s Reform Bill provides a once in a generation opportunity to improve the lives of Renter’s.  However, in order to achieve maximum impact and create true strategic change, we believe it is crucial to phase in these significant changes in a considered manner over a period of time, avoiding unexpected unintended consequences which only hurt those we are seeking to protect the most – tenants.

“This report seeks to find a balance between encouraging investment in the sector to increase available homes and ensure they are of consistent good quality through natural supply and demand competition.”

You can read the full report HERE



Comments

NewYorkie View Profile

10:29 AM, 26th May 2022, About 3 months ago

Reply to the comment left by Old Mrs Landlord at 25/05/2022 - 23:15
I read the Exec Summary, and to be honest, it's stating the..... obvious [and I was there 18 months ago!].

If the MoJ was serious about doing something innovative, it would have taken my proposition seriously. Instead, it is rolling out its own 'new' Courts system [at a huge cost] and will not consider any deviation which addresses events over the past 2 years, and which had not been considered when their system was specified, because it was simply I conceivable.

Luke P

13:10 PM, 26th May 2022, About 3 months ago

Reply to the comment left by Peter Gill at 26/05/2022 - 09:35
Far too sensible an idea, Peter!

CMS View Profile

5:56 AM, 27th May 2022, About 3 months ago

Reply to the comment left by Chris Bradley at 25/05/2022 - 10:40
They will never go after tenant's...the landlord is the one they consider to have money (the let property is likely at least a second house) and its not about what's fair or just is simply about who can pay. Even if they had a tenant's list with penalties they would never enforce them I'm afraid.

Dylan Morris

20:19 PM, 27th May 2022, About 3 months ago

No mention of “Lifetime Deposits”
……ha ha ha !

DP

9:11 AM, 28th May 2022, About 3 months ago

Reply to the comment left by Chris Bradley at 25/05/2022 - 10:40
We all know the story and have been commenting and lamenting about it for many months and I wish I felt confidant about the outcome to this report/ reform but, having just read this post I thought doesn't that just say it all !
This is a two way street and whats good for the goose should be good for the gander and in my experience tenants do not always follow what they should to look after a property and even the AST does not incentivise them sufficiently because, at the end of the day, you are stuck with the 'opinion' of the deposit holders. Wear and tear is often what 'neglect' is classified as but it costs the landlord a lot to rectify and it is not always ideal to have to keep reminding tenants about how to look after and live in a property especially if you happen to also be a neighbour.
There should be some element introduced to make very clear to tenants that they need to acknowledge and follow the rules or it will cost them and make it easier for landlords to recover these costs rather than fight it out at the end.

Dylan Morris

10:18 AM, 28th May 2022, About 3 months ago

I keep saying what’s the problem ? If tenant is issued with a Section 21 they can simply find another property and will have two months notice to find one. Never been a problem before. If they’ve been a good tenant, paid rent on time etc there’s no reason for them to not find another suitable home.
So what exactly is the problem here ? Ahhh……the real problem is the shortage of rental properties and NOT Section 21. This is what should be being addressed not the removal of Section 21 which solves nothing. Of course it’s easier to blame Section 21 than to increase the supply of rental units.
And on another matter……..according to the Bank Of England and the Fed inflation is just transitory you know !!

chris

11:02 AM, 28th May 2022, About 3 months ago

I’m sorry but if you think government is looking at this to make landlords and tenants lives better then you need to understand the government’s goal is to get renter’s to be home owners so when you read what they are wanting to do then read backwards to see how it helps achieve that goal

Rod

15:17 PM, 31st May 2022, About 3 months ago

This is a repost of my comment on Ben Beadle's posting on the NRLA's call for property passports
Please note, I drafted this a few days ago before The Lettings Industry Council posted their recommendations.

Much of what they have suggested matches the expectations laid out below and it is good to see that they have taken a wider view by including rent to rent and short term lets/furnished holiday lets
Look out
- if you've not been paying attention, we will get a version of this, whether you want it or not.
I've lost count of the number of posts on mandatory, additional and selective licencing schemes and their associated fees. With the Government now threatening to level up the rental market by bringing the PRS under the Decent Homes Standard, it doesn't take much imagination to see the direction of travel will be to match Wales and Scotland by requiring all rental properties to be certified.
I'm not suggesting that the NRLA's proposal is the way to go, but there would be some benefits if all rental properties had to be certified on a periodic basis and the relevant documents were available online, in the same way that EPCs are.
iHowz worked with Southampton Council several years ago to get them to take a different approach when they wanted loadsa money to bring in additional licencing. They were eventually persuaded to allow landlords to get an independent inspection and submit the paperwork for each inspected property when they applied for a licence. https://ihowz.uk/southampton-licensing/
The advantages:
- licencing costs are significantly lower
- all properties are inspected (not just those they bother to select)
- landlords control the inspection process, ensuring it is inspected in the condition they have provided it
- landlords can schedule their inspections, keeping costs and disruption to a minimum as a group of properties can be inspected together
- the council can concentrate their efforts on those who fail to licence their properties
Recent years have brought a succession of laws and other regulation for the PRS, meaning smaller landlords in particular have found the administrative burden and other compliance aspects have seemed overwhelming.
Excluding HMO/licencing specific requirements, we now need to ensure we comply with the following, or risk fines and difficulties when we try to recover possession:
- Fit for Habitation (including Legionella and HHSRS)
- Furniture and Furnishings Regulations
- EPC certification (E or better / exemption)
- Electrical Safety
- Gas Safety
- Fire and CO precautions (additional requirements from this Autumn)
- Right to Rent Checks
- How to Rent Guide
- Inventory
- Deposits and Protection
Much of this documentation has to be provided to each tenant and evidenced. If this was available on a portal, which your tenant had to log on to at the commencement of the tenancy, it would allow electronic confirmation. Landlords would only need to download data once and only have to reload it in exceptional circumstances, as periodic independent tests could be updated by testing organisations (EPC, gas, electric), Government guides would be automatically linked and landlords could be reminded of any other obligations, such as testing alarms.
Taking things a step further, such a register would provide a tool to drive out landlords who rent non-compliant properties, either by checking that a property was registered before a tenant could claim housing benefits or flagging up an inspection for any property not on the register. No doubt, it would also be used by insurers and lenders to help price their products. Who knows, Government might even use it to identify recipients of grants for energy efficiency measures !!
We don't want more costs or Big Brother, I hear many of you scream as you reach to click the Reply button.
To that I say, the costs of such a scheme should be lower than existing licencing, and would take the politics out of it, as the core elements are national standards and the database could built and administered by commercial organisations, in a similar manner to the deposit schemes, using Open Source data from Government and inspection organisations.
A certified rental property register would be a tool that provides landlords the ability to check that they are renting a compliant property and document that their tenant has been provided the required information. This would help ensure that landlords can regain possession while robbing Shelter / tenant unions of much of their commentary about standards in the PRS. Assuming that this could be achieved for £75 or less a year for each property it would only represent an additional cost equivalent to £1.50 pw, which is significantly less than most licencing schemes and many property management tools, never mind the cost of a failed possession hearing.
If we don't take control of the licencing and certification agenda and drive the decision-making, we can guarantee that the Department of Levelling up, Housing and Communities will force a far worse alternative on us.
Lastly, I know some of you don't see the point of forking out less than £100 a year to join a landlord association, but there are about 2.2 million landlords with properties in England and less than 180,000 belong to a landlord association. That's less than 1 in 12 landlords who belong to a trade association.
How can you expect to get our voice heard at national and local level?
(Some of you have already made this point.)
I know some of you wish the NRLA stood up to Government a bit more. We'd love to have you join iHowz or you could join one of the other more regional associations. With the Renters Reforms and other changes to property law on their way, now is the time to join up and help us get your voice heard.
https://ihowz.uk/join/#membership
iHowz will be contacting TLIC to see how we and other landlord associations can represent their member's interest in helping shape any proposals.

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