Housing Minister dismisses landlord exodus amid concerns of shift to holiday lets
1 year ago | 14 comments
Renters’ Rights Bill could prohibit advance rent payments
12:01 AM, 29th November 2024, 1 year ago
25
The Labour government is considering banning landlords from accepting advance rent payments from tenants.
During a question to Housing Minister Matthew Pennycook, Dr Simon Opher, Labour MP for Stroud, asked whether the Renters’ Rights Bill would prohibit landlords from accepting one month’s rent in advance.
Many landlords and letting agents request tenants to pay the first one or two months’ rent upfront, which is perfectly legal, as a form of financial security before tenants move in.
Demanding large amounts of rent in advance must be prohibited
Mr Pennycook said: “The government recognise that demands for extortionate rent in advance place a considerable financial strain on tenants and can exclude certain groups from renting altogether.
“We are very clear that the practice of landlords demanding large amounts of rent in advance must be prohibited.”
Mr Pennycook adds: “Although it might be argued that the interaction of the new rent periods in clause 1 of the Renters’ Rights Bill, which are a month or 28 days, and the existing provisions of the Tenant Fees Act 2019, relating to prohibited payments, provide a measure of protection against requests for large amounts of advance rent, we believe there is a strong case for putting this matter beyond doubt.
“The government is therefore giving careful consideration as to how best that might be achieved through the Renters’ Rights Bill.”
Mr Pennycook did not address directly whether specifically one month’s rent in advance would be prohibited.
More harm than good
Advance rent payments are often used for various reasons, such as when a tenant has a poor credit history, cannot provide a guarantor, or has recently arrived in the UK.
In a webinar for letting agency platform Goodlord, the firm’s managing director, Oli Sherlock, warned that banning advance rent payments could do more harm than good.
He said: “The point of the bill was to make a fairer private rental sector and give tenants a better standard of living making the playing field more level between tenants and landlords. However, stuff like this amendment is limiting potentially accessible people to property, not encouraging it.”
Tags:
advance rent payments, housing minister Matthew Pennycook, labour government, Landlords, Letting Agents, rental security, renters rights bill, Tenant rights
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Member Since May 2015 - Comments: 2201 - Articles: 2
12:41 PM, 29th November 2024, About 1 year ago
Reply to the comment left by Marcus at 29/11/2024 – 12:24Sorry, the government has snookered you there. Contracts must be for one month or four-week periods. I very much doubt that periods in advance will be allowed to be charged until the period starts.
Member Since February 2018 - Comments: 627
12:47 PM, 29th November 2024, About 1 year ago
Many foreign students, with no state support, and recent migrants eg from HK might only be viablecwith part or whole prepayment for term.
Member Since July 2013 - Comments: 754
4:05 PM, 29th November 2024, About 1 year ago
So Govt may require LLs to hand over an asset worth many £000s to someone who hasn’t paid even one month’s rent and only 5 weeks’ deposit. Then they will allow the tenant a significant ‘rent free’ period before they can be evicted for non payment of rent with no penalty for arrears, trashing the property or breach of contract.
Has Mr Pennycook heard of running a business? Risk and return? He and his buddies are going so far skewed in favour of tenants they’ve lost sight of common sense and the fact that renting is a business. PRS is not the social sector and we are not here to be mugged.
It would be funny if it wasn’t so scary just how dumb Pennycook and his cronies can be…
Member Since July 2023 - Comments: 181
4:33 PM, 29th November 2024, About 1 year ago
Reply to the comment left by TheMaluka at 29/11/2024 – 10:59
A thought.
If one uses an agent.
Could T deposit say 6 months rent with the agent who, like a solicitor with clients money, holds it in an escrow account.
Agent pays LL, T tops up escrow?
Member Since May 2015 - Comments: 2201 - Articles: 2
4:50 PM, 29th November 2024, About 1 year ago
Reply to the comment left by Jim K at 29/11/2024 – 16:33
Great idea, but I would not like to be the landlord or agent testing the concept in court.
Member Since October 2024 - Comments: 197
4:56 PM, 29th November 2024, About 1 year ago
The politicians are asking for the tenants to legally steal the landlord’s asset and walk merrily away. Have they gone bonkers. Why don’t they also legalise for all consumers to go shopping in John Lewis, Sainsburys etc and try out all the goods they need and pay or return them as they wish.
What sort of society, these politicians want?
I would rather have properties empty, stop paying interest on mortgages until the fixed rate completes and sell all properties, pay off the banks and enjoy if any money left after all the costs and no income from any properties. What are they aiming at, an anarchy state.
Maybe stop social tenants from paying rents, stop all taxes going to the hmrc. Pennycook has lost his marbles in his excitement of brain storming and cannot see rights from wrongs.
Member Since January 2024 - Comments: 350
5:07 PM, 29th November 2024, About 1 year ago
Reply to the comment left by Jim K at 29/11/2024 – 16:33
I doubt it, the agent is exactly that, he is agent for the landlord (allegedly, although many seem to work for the tenant). So if the landlord cannot do it he/she cannot do it.
Member Since November 2020 - Comments: 51
9:10 AM, 30th November 2024, About 1 year ago
Never take anyone who offers large sums upfront. They are normally planning a grow
Member Since January 2015 - Comments: 1447 - Articles: 1
9:18 AM, 30th November 2024, About 1 year ago
Reply to the comment left by TheMaluka at 29/11/2024 – 11:10
Doesn’t Rent Guarantee already discriminate against those tenants on benefits?
Member Since January 2015 - Comments: 1447 - Articles: 1
9:21 AM, 30th November 2024, About 1 year ago
Reply to the comment left by TheMaluka at 29/11/2024 – 12:41
Surely the 28 days rent period comes from housing benefit which is always paid 28 days in arrears?
Always been a nightmare when tenants have to pay a rent top up on a 6 or 12 month tenancy agreement and that top up is, as per the TA, monies in advance.