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As the Renters Rights Bill enters the House of Lords (next at committee stage) its fairly safe to assume that no major changes will be made and therefore for us all to plan for the near future when there will be so many changes.
The last draft is here
https://bills.parliament.uk/publications/57759/documents/5624
There are 33,000 members in my Facebook group, landlords and agents and tenants. Reading the posts, which mainly ask for help, on a daily basis keeps me close to the reality of the private rented sector from both sides. There is a lot to learn from the posts from both landlords and tenants in relation to the coming changes under the Renters Rights Bill and I will talk about some of these but the overriding message which comes across to me is
Section 21 has been used to control tenants and tenants have lived in fear of being evicted when they have done nothing wrong and in fact have been model tenants. I ask myself why would a landlord want to evict a model tenant? We all know that landlords have helped to bring about the end of Section 21 by misusing it in order to avoid section 8 – though I am not at all sure why that is? I had always assumed that they had actually got grounds but for some reason didn’t want to use them.
How wrong was I?
Its only from reading the fears of landlords that the penny has dropped and in fact it isn’t that they necessarily had got grounds but section 21 was being used as a control mechanism. Let me show you:
Comments on the Facebook group from landlords about their fears of the changes under the Renters Rights Bill
- Do tenants realise that when they need to give 2 months notice a landlord will not wait 2 months and will let to those who can move in sooner
Will we or will be take more care about which tenants we choose when we will struggle to remove them?
- I think that tenants should be worried, if they aren’t, because with banning guarantors and rent up front
There is no ban on guarantors but no rent up front will impact on those who don’t met affordability. It may impact on overseas students and short term contractors but when that’s the market we are in we will need to find another way
- Periodic tenancies will attract the “in between properties” house buyers short term contractors as well as those trying an area before they settle down this will increase, set up fees
- How will agents charge fees
A good question
- Who will be responsible for answer the request for pets – the landlord or the agent?
Its always the landlord who must make this decision
- It just means landlords have to tread very carefully as mistakes will be costly and gastromical rent for tenants when the supply of rental properties falls even further behind demand
- LL here. On the face of it it looks as though it’s doing tenants a favour? But in reality I feel it’s going to make things so much more difficult for them. Lots of LL’s selling up, rents will almost certainly rise?
- Fantastic time to be buying and a landlord. Rents are going up up up
Do landlords not realise that there is always a glass ceiling and there is a point at which the void isn’t worth the potential rent increase? Then there is the worry that rent controls will be brought in if there are “gastromical” rents increases
- Currently, students pay quarterly in advance aligned with their student finance. This helps them budget, but monthly payments could lead to budgeting issues and unpaid rent.
- Mainly I feel the language used by this gov and the last has been an attempt to vilify LL’s. I worry it might embolden bad tenants who have no intentions of paying rent or looking after their rental home.
- its not only landlord disaster. Its also tenants huge issues as landlords will be even more picky for tenants and will simply rather wait for the right one with an empty property, who ever will be on better financial security rather than dss or lower income, families.
All the above feel like landlords projecting their fears onto the tenant. Yes there will be major changes for some tenants but they will need to relearn how to protect their futures by not getting CCJs and being evicted for things which they have chosen to do or not do. It hasn’t been so long ago when people were predicting that landlords would not take those on Universal Credit because they could not get direct payment of the rent until the tenant has already gone into 8 weeks arears. Some landlords did stop taking these tenants but many more continued and changed their systems to enable them to manage any issues. Even tenants who had never had to manage their benefits, some from several generations of worklessness, learned to do it because they knew that the alternative was intentional homelessness and no help from their local authorities. Homelessness is a powerful motivator and its up to us to make certain that tenants know that we will use section 8 as soon as they meet the criteria and will not listen to promises etc… because we are protecting our own businesses and the stock of available homes to rent.
If we do not use the law as its written we have only ourselves to blame when tenants deliberately get into rent arrears and a section 8 with rent arrears means a ccj which is potentially on their records for 6 years and will damage their future prospects or renting, buying or even borrowing money/using financial services. It will take a while but eventually tenants will become re-educated but ONLY if we use the legislation at our disposal and take the trouble to do thorough referencing/credit checking before taking a new tenant.
- I think the landlord register & ombudsman will ultimately be a good thing for the industry. Weed out the bad landlords. & mean us good landlords dont get the bad rep we currently do, if the industry improves as a whole.
Over 100 people took the time to contribute to this discussion but one person spent a lot of time and came back with a well thought through list of concerns which I am sure will be shared by many landlords:
Setting aside the obvious (scrapping of Section21) here are my Top 3 as l understand them, and l will go into a bit of detail below the bullet points:
1. No rent in advance
2. Rent Disputes: increases AND the initial rent
3. Landlord data base
1. No rent in advance.
Any payment of rent in advance will be a prohibited payment, subject to significant penalties under the TenantFees Act.
It is not just rent in advance of 6 or 12 months, (which is a valuable option for Tenants in various situations), but even the 1st months rent.
A landlord will not be permitted to take ‘rent in advance’ any more. The earliest day a rental payment can be made is on the 1st day of the rental period. So, when signing up a new Tenant on a new TA a LL can not ask, and the Tenant can not offer, to pay a penny until after the landlord has signed the TA.
The landlord can not withold the Keys if the Tenant doesn’t /can’t pay the 1st months rent, and the non payment of that 1st months rent has to be treated like any other arrears!
In essence you can not take the 1st months rent until the contract is signed and the Tenancy has started.
The bill says “prohibition of rent in advance (except initial rent). It doesn’t apply to the first rent payment therefore we can take the first months rent when the contract is signed and we do not need to provide keys/access until that payment is made because a contract in law must have three elements
- Offer
- Acceptance
- Consideration
The offer is when the contract is given. The acceptance is when the contract is signed by both parties and exchanges. The consideration is when the rent is paid. Without the rent payment the contract is not valid and we therefore do not have to give the other party the keys and I am happy to say the fear of immediate rent arrears is unfounded though understandable.
2. RENT
Tenants will have nothing to loose and everything to gain by challenging every rent increase via the Tribunal. All rent increases will have to be via a Section13. The new Bill will mean that any proposed rent increase challenged via the Tribunal will not come into force until the Tribunal rule on it, and unlike now, will not be back dated. This means that even the modest rent increase can be delayed by months and will reset the date for the next rent increase.
Also, when a Tenant signs that Initial TA they can dispute the rent within the 1st 6 months. Yes, you heard me. Even though they agreed to and signed the TA, they can go to the Tribunal and say they believe it was excessive/above market any time in the 1st 6 months!
You will need to keep evidence of what the market rate was at the time of signing (comparable properties at similar rates).
3. DATA BASE
The prospect of going on a National Data base is horrifying to me. Having our names, addresses, assets all listed on a data base is not only offensive (as if we are convicted felons) but dangerous. This could create a hit list for Burglars, who assume we are all wealthy, Activists who hate us, and the obvious bombardment of sales calls etc from Agents, insurers, mortgage lenders etc.
And what about the angry/disgruntled prospective Tenants who you didnt let the property to turning up at your door? Or the violent ex partner tracking you down via this handy dandy data base?
2. You’ve got a point and I’m sure that there are tenants who will try this but a tenant can go to rent tribunal in the first six months now so that won’t change. The change is that without section 21 the fear of eviction isn’t there to stop them – lack of section 21 will open bigger doors than this though
3. I don’t believe that there will be a visible list I believe that there will be a search option to find out details specific to a property and its owner. Although currently for £4 you can find out most of this on Land Registery I know because recently I have used it to track down a list of leaseholders on a particular development.
Also currently if a tenant writes to ask for landlords details an agent must supply them within 21 days.
Also we must supply tenants with an address in England or Wales where legal notices can be served
