Tenant Fees Act barrier to renting with pets

Tenant Fees Act barrier to renting with pets

14:35 PM, 6th September 2021, About a month ago 7

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Propertymark is backing a Report and an Open Letter sent from a cross-party group of over 35 MPs and peers who have joined together with leading pet charities and organisations to explore how the Tenant Fees Act is impacting on renting with pets.

 The new “Heads for Tails” report, published yesterday 2 September 2021 by pet charity AdvoCATS, reiterates Propertymark’s concerns about the limitations of the Tenant Fees Act which caps Security Deposits and prohibits landlords from charging for pet damage insurance.

The report’s research shows that over half of pet-owners would be willing to take out pet damage insurance if required by a landlord and three-quarters of landlords support pet insurance.

Propertymark’s Private Rented Sector Report for June revealed that 69% of agents supported the need for a ringfenced pet deposit.

The Letter has been sent from Conservative MP Andrew Rosindell to the Secretary of State for Housing, Communities & Local Government and co-signed by politicians including Labour’s Andrew Gwynne, Green MP Caroline Lucas and Liberal Democrat leader Ed Davey.

Commenting, Timothy Douglas, Policy and Campaigns Manager said: “There is often more of a possibility of damage to a property where there is a pet, and as warned by Propertymark and others, the limitations caused by Tenant Fees Act has reduced the appetite for many who rent out property to take on greater risk.

“The strength of feeling amongst politicians, charities and sector organisations means that the UK Government must now revisit the rules and explore options to remove barriers that shouldn’t have been there in the first place, and support more people to rent with pets.”

Dear Secretary of State          Open letter on changing the Tenant Fees Act (2019)

We are writing to you regarding the Tenant Fees Act (2019) and the detrimental impact this legislation has had on pet ownership in rented accommodation.

As you will be aware, Andrew Rosindell MP wrote to you on August 20th to bring to your attention a new report by the charity AdvoCATS, which is due to be published tomorrow.

This report finds serious problems with the Tenant Fees Act, because the list of permitted payments does not include pet deposits, while sections 1 and 2 of the Bill also prohibit landlords from requiring a contract of pet damage insurance as part of a tenancy agreement.
The report finds that landlords have responded to these changes either with a blanket no pets clause, or by increasing rents for pet owners. One in five landlords who previously allowed pets no longer do since the passing of the Act.

In the case of landlords who have increased rent, this is clearly a suboptimal solution. It punishes responsible pet owners, unlike pet deposits which would be returned to responsible pet owners and pet insurance which can be used to build up a no claims history, and it reduces transparency of payments, a key aim of the Bill.

The report therefore recommends that secondary legislation be used to add pet deposits to the list of permitted payments and that the issue concerning pet damage insurance be investigated to see whether secondary legislation would be sufficient to make the necessary change, or if primary legislation would be needed to amend sections 1 and 2.

Public polling finds that over half of pet-owners would be willing to take out pet insurance if required by a landlord, although 40% of respondents said they would prefer a pet deposit, to 22% who said pet damage insurance, if given a choice between the two. This clearly demonstrates the need for choice.

Finally the report finds, from multiple conversations with insurance companies, that pet damage insurance is seen as unviable by many companies and that the Tenant Fees Act is a key factor because it limits the number of potential customers. It is likely that, if the Act were reformed and as more customers became available, premiums would fall, further cementing public support. Given 75% of landlords support pet damage insurance, this would likely garner significant overall support.

The Government has made clear its support for responsible pet-owners in rented accommodation through the Model Tenancy Agreement published in January. However, due to the unintended consequences of an otherwise praiseworthy piece of legislation, there are significant and unnecessary obstacles to bringing a pet into rented accommodation.

Andrew Rosindell M.P. Member of Parliament for Romford

House of Commons, LONDON, SW1A 0AA

We are confident this proposal would garner widespread support across the House and we therefore urge you to read the attached report and its recommendations closely.
We look forward to your response.

Signed:

MPs and Peers

Andrew Rosindell Sir David Amess Chris Bryant Lisa Cameron, Chair of APDAWG Rosie Cooper Sir Ed Davey Tim Farron Sarah Green Andrew Griffith Andrew Gwynne, Co-chair of APGOCATs Robert Halfon Dame Meg Hillier Wera Hobhouse Dr Neil Hudson Sir Greg Knight Sir Tony Lloyd Caroline Lucas Andrew Mitchell Anne-Marie Morris Jill Mortimer Sheryll Murray, Chair of APGOCATs Virendra Sharma Mohammad Yasin

Lord Bowness Lord Dubs Lord Goddard Baroness Hodgson Baroness Lister Lord Marlesford Baroness Nicholson Lord Oates Lord Ranger Lord Risby Lord Storey Lord Trees Lord Truscott Lord Walney

Organisations

AdvoCATS Alan Boswell Group A-Law #CatsMatter Dog Champion Scheme EMPO Hamilton Fraser Inventory Base Landlord Zone Dr Marc Abraham Mars Petcare mydeposits NOAH NRLA One Broker Insurance PAAW House Pets Lets PetsScore Portsmouth and District Private Landlords Association Property Mark Property Tribes Property Redress Scheme Renting Evidence Society for Companion Animal Studies Stolen and Missing Pets Alliance Street Paws Street Vet The Dispute Service The FOAL Group Your Cat Magazine Your Dog Magazine Vets Get Scanning



Comments

by Ian Narbeth

11:00 AM, 7th September 2021, About a month ago

Landlords will need to be cautious about pet insurance. Unless the insurance industry is "persuaded" to include policy wording that protects landlords (much as mortgagee protection clauses are included in commercial property insurance policies), there are risks for landlords.
For example if the tenant misrepresents the risk to the insurers they may avoid liability - e.g. claiming to only have one dog when they have two or more. If the tenant does not disclose all his personal circumstances, e.g. that he has a CCJ for rent arrears against him or a criminal conviction, insurers may refuse to pay out.
Policies renew annually so if the tenant fails to pay the premium the policy will lapse.
Insurance policies have exclusion clauses and so Parliament needs to ensure these do not lead to insurers avoiding liability. For example, it is commonly a condition in policies that damage is reported promptly. What if the policy contains such a provision but the tenant fails to report?
Those advocating for insurance should insist it is the landlord's choice whether to accept it or a higher deposit.
I don't know where the 75% figure supporting pet insurance came from but the number may depend on the question posed. "Would you be more likely to accept pets if the tenant had pet insurance?" might well achieve a 75% success rate (the other 25% not wanting to take pets at all!)
I would also be wary of Government requiring that landlords had to accept pets (with insurance/higher deposit). It should be the landlord's choice and his freedom of contract. The Government's new model contract puts the onus on the landlord to show a reason for not accepting pets. Landlords are free not to use that contract.This must not be imposed on landlords.

by Beaver

13:05 PM, 7th September 2021, About a month ago

I agree with this. I'm sympathetic to people with pets but if the dog chews or the cat scratches that can easily do a lot of damage. If it's an indoor rabbit they also chew and do a lot of damage. The last time I had an owner with a pet it took about an extra day of cleaning to get all the dog hair out of all the carpets and get rid of the smell. Even if you were minded to consider insurance you've still got to get that out of the tenant if it's the tenant insuring and not you: The chances are that the insurance company would find a reason not to pay you.

And even if the insurance policy was in your name as the landlord you would still need to know how many pets they have and what species, and you would need to be able to check.

At the end of the day the higher deposit is the simpler option. But it's not just pets that cause extra cost.

At present your only options are to (a) say no (b) increase the rent.

by Peter Fredericks

13:11 PM, 7th September 2021, About a month ago

Pets must NOT be foisted upon landlords. In leasehold properties there are usually covenants in the head lease prohibiting any pets. The bigger scandal here though is a constitutional one...Lord Bourne's Tenant Fees Act being originated in the house of lords, an institution of virtually no democratic legitimacy, insisting that one group of business people must undertake significant amounts of work or pay agents to do the same for no remuneration. It is grossly discriminatory and a denial of what should be a constitutional right to be remunerated for work done. It is no excuse that these fees can be absorbed in higher rentals as for much of the country further north there has been little prospect of loading rentals in this way. The TFA is just a disgrace..... as is the institution that enacted it.

by Luke P

13:27 PM, 7th September 2021, About a month ago

Why not campaign against the removal of S.21, which underpins BTL confidence, rather than firefighting…?

by Chris @ Possession Friend

22:52 PM, 7th September 2021, About a month ago

Propertymark are more effective at fighting for landlords than the NRLA, perhaps members should change organisations ?

by Ian Narbeth

10:53 AM, 8th September 2021, About a month ago

Yesterday Eddie Hughes junior housing minister replied to Andrew Rosindell saying the current deposit law as per the Tenant Fees Act enabled landlords to charge tenants an additional deposit.
How out of touch can he be?
Whilst many landlords may charge only 4 weeks' or a month's rent as a deposit, a maximum of 5 weeks' does not provide much extra security. Take a monthly rent of £1000. Five weeks rent is £1000 x 12 x 5 divided by 52 = £1153.84. Does the minister seriously consider that an additional £153.84 (or less than 16% extra) is sufficient to cover pet damage?
Mr Hughes also takes no account of what the pet is. Minister, can you tell the difference between a tortoise and a Great Dane? If so, which on, on average, do you think, using your knowledge and life experience and undoubted intelligence, is likely to cause more damage to a property?
Sorry tenants, I doubt that even a single landlord in the country will be persuaded by this MP.

by Peter Fredericks

10:01 AM, 12th September 2021, About a month ago

Having seen Eddie Hughes' reply to my MP on a separate matter, I think EH would struggle to discern one part of his anatomy from another.


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