Property industry reaction to Rental Reform White Paper proposals

The government will finally publish its long-awaited White Paper today outlining plans to scrap Section 21 evictions.

The new bill will also strengthen the rights of private renters by applying the legally binding Decent Homes Standard to the sector and introduce a new ombudsman for private landlords to help resolve issues without having to go to court.

A new property portal will be introduced under the act, where landlords can access information about their obligations and tenants can get performance information that will help them hold their landlord to account.

Landlords and lettings agents will also be required to accept pets as part of the reforms being proposed.

There has been a sharp rise in tenants moving property in order to accommodate a pet, according to the latest survey from The Deposit Protection Service (The DPS).

Around a thousand tenants who had moved property between October 2021 and March 2022 took part in the DPS’ 2022 tenant survey, with 30% saying that they had done so to accommodate a pet – making it the most common reason for moving.

Industry reaction:

David Reed, operations director of Richmond estate agents, Antony Roberts, commented: “The devil will be in the detail but any railroading of landlords to accept any pet, or any potential pet, will only further limit the supply of property to rent and exacerbate the problems that tenants already face.

“I believe that the previous way (before the Tenants Fees Act), of dealing with pets worked relatively well – in consideration of the landlord accepting a pet, if they wished to do so in principle, then the tenant was expected to pay a higher deposit to help protect the landlord against the perceived risk of pet damage and additional cleaning.

“One of the major issues in the private rental sector is the loss of droves of landlords over recent years by way of ongoing legislative intervention by the Government. This has caused the restricted supply of property available to rent for most current and would-be tenants today. As a result, they face higher rents, limited choice and a bunfight in many cases.

“Of course, we welcome driving up standards of safety, security and maintenance and rightly punishing landlords that abhorrently fail to meet these standards, but in order to have a healthy rental market, the government also needs to help attract new or previous landlords to offer their property for letting.”

 

Nathan Emerson, Propertymark CEO, commented: “After waiting three years to see exactly what this reform will look like, we’ve now got a set of proposals titled ‘The Fairer Private Rented Sector White Paper’. But there are some elements that don’t appear to be so. How is it fair that a tenant can simply end a tenancy at a time of their choosing, but an agent or landlord has to present a valid reason that is defined in law?

“We’ve already set out broadly what we think reform should look like in our The Future of Renting paper.

“Now we have the detail of what’s being proposed, we will be closely scrutinising it and working with Ministers to help them understand how on a practical level it will impact our letting agents members and their landlords.

“Our sector provides around 4.4 million households in England with a place to live. Property is a good long-term investment but the number of property owners choosing to withdraw from this area is growing*. That’s the result of a decade of tax and regulatory burden that simply does not incentivise investment, especially for single property landlords who make up 43% of the market.

“The private rental market is already under huge strain with renters outstripping available properties and we need to be able to attract new investment.

“If Ministers really do want to create a ‘fairer private rented sector’, they must work with us to ensure these reforms are carefully balanced and any interventions to achieve short-term objectives do not constrain the market in the longer term.”

 

Ben Beadle, chief executive of the National Residential Landlords Association, said: “Whilst headline commitments to strengthening possession grounds, speedier court processes and mediation are helpful, the detail to follow must retain the confidence of responsible landlords, as well as improving tenants’ rights.

“We will be analysing the government’s plans carefully to ensure they meet this test. A failure to do so will exacerbate the housing crisis at a time when renters are struggling to find the homes they need.

“The eventual legislation needs to recognise that government actions have led to a shortage of supply in the sector at a time of record demand. It is causing landlords to leave the sector and driving up rents when people can least afford it.”

 

Richard Donnell, executive director of research and insight at Zoopla, said: “With the backdrop of the cost-of-living crisis putting pressure on renters, these reforms are welcome and timely, particularly as they’re largely focused on boosting the quality of housing in the rented sector. The private rented sector plays an important role in the housing market, providing much needed homes for a wide spectrum of households. These reforms mark another milestone in the journey to create a suitable equilibrium between renters and private landlords who provide the majority of homes for rent.”

“However, it’s important to note that the private rented sector is under growing strain due to lower levels of new investment by private landlords, largely a result of tax changes and more regulation. There are a growing number of amateur, private landlords exiting the market, offsetting the increased investment from corporate landlords and institutional investors into the build-to-rent market. There is a delicate balance to ensure reforms don’t compound these supply-side challenges which continue to keep an upward pressure on rents, which have risen 11% in the last year. Ensuring decent homes is paramount but so is the investment into this important sector of the housing market.”

“The Zoopla Lettings Advisory Board has advocated a range of initiatives to improve the transparency over the process of owning and renting homes. In particular, the need for a property register for rented homes to help with compliance on standards of accommodation and the move to define when homes meet the Decent Homes Standard for private rented homes. This will also boost transparency for renters and landlords who both have to deal with often complex regulatory requirements. There is a lot of detail to work through in how this is rolled out and Zoopla will continue to work with our advisory board and estate agency partners to seek operational efficiencies in the lettings market through our software platforms.”

 

Ian Fletcher, director of policy at the British Property Federation, commented: “Efforts to create a better and world-leading rental sector for tenants and investors is something we very much welcome. Good landlords know that reform can be win-win, protecting and enhancing renters’ rights but also encouraging residents to feel at home, increasing the time they stay and ultimately benefitting tenants and investors.

“There are occasions when issues arise on both sides of a tenancy, and while it is a last resort the renters’ reform will result in more disagreements between investors and tenants being seen in court. It is vital that the government delivers on its digitalisation of the courts’ agenda ahead of these reforms to ensure a swift resolution to these cases. Investors will feel let down if that is not the case.

“It is now important the sector works with government to ensure that the reforms deliver for renters and investors. That was the promise given by the Government in 2019, and we look forward to playing our part in ensuring the reforms deliver a stable home and customer excellence for renters – two of the key pillars on which the Build-to-Rent sector has been built over the last decade.”

 

Daniel Evans, chair of the AIIC, remarked: “This has come a lot sooner than expected, which suggests political expediency and distractions on everything from the Rwanda debacle to the vote of no confidence last week are part of the reason for the White Paper appearing so suddenly. While the clarity and sense of certainty will be welcomed by the industry, it seems likely that parts of the lettings industry will be happier than others about what is included.

“The issue of pets is a thorny one, and something that is difficult to mandate, but it seems like the government is trying to make it more of a right to keep pets.

“The Section 21 and Section 8 stuff has largely been baked-in already, with it long being known that these would be subject to reform, but it’s interesting that the government seems to have quietly shelved the idea of a landlord register or mandatory redress, which some had argued would improve compliance and help rid the sector of rogue operators.

“It seems certain that there will be opposition against some of what is included in the White Paper, so we’re all in for a bit of a bumpy ride yet.”

 

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10 Comments

  1. leelee30

    While I believe in good homes for tenants, over the past 18 months I have experienced  the worse check-outs at the end of tenancy.
    The tenant believe they can leave the property unfit for the next tenants, dirty, scuffed walls, iron on carpets ect.

    We have lost the respect of a home by tenants, putting a pet is should be the home owners choice,  the government do not know that not all tenants are good ones, not all clean and tidy.

    I would not have a cat or dog in any of our let’s. Unless I was 100% sure they would respect this property and contents.

    So why ?

    1-Chewed Banister rails

    2- New fitted carpets left stained and the smell of pets is a house is horrendous affect our help causing an asthma attack.

    3- New PVC door scratched both sides

    4- All wood floors damaged

    5- Wood door frames chewed

    Why should a landlord have this to pay for  on each check out with a pet?
    All these repairs are nearly 5k in damages – taken on a bond of 5 weeks rent  £525 pounds ( the joke is this government has no clue of the real life of an agents, our poor Landord and there lovely homes trashed  ) this is why 65% of the landlords sold in the last 12 months.

    So why have we low stock, the government makes changes and distribution, there is no betterment for good Landord is there?  With having to find 1000k of pounds to pay on short let’s of 12 months  therefore  income is 75% lower than 2018 or they don’t even break even, running at a loss sometimes.

    ask yourself a question would you hand over your home to a tenant like that?

    NO so why make the Landord’s do that ?

    Yes not all tenants are bad, but 70% of our checkout are now needing work which are down to how the tenants live. No respect of a property

     

    that’s the true facts,

    Thank you for reading A

     

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    1. biffabear

      Can’t disagree with a word of that.

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  2. TonyT

    Maybe agents should invite their local MP to attend a post tenancy inspection to see the real world.

    I also heard a government spokesperson on the radio just now state that tenants would be able to go to a tribunal in the event of an “excessive” rent increase.

    Perhaps he should be aware that his right has existed for years and is explained on a Section 13 notice, but is almost never taken up by tenants in my experience.

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  3. toriegirl

    Yes Leelee30 the properties are coming back in a poor state.

    Regarding pets  due to covid many got a pet for the covid period then when they had to start back at work just dumped them on charities .  These charities are at full capacity, also if kept they then are not cared for because do not have the time

    No walks  no love and dumped this now is going to be supported by this government .  Pets can be part of the family and loved and looked after but many are not.

    I have had the chewed newal posts, doors , windows, smells , fleas,garden full of deposits.  I do take some pets and some properties you would not bel they had a dog.  But this is rare and how many pets will  be allowed ie 3 dogs ? I am sure the neighbours with dogs howling all day will be impressed and no chance of eviction.

    So when a landlord has spent around 500 to get a tenant in and then they vacate after a month this will cost the landlord around 1000 to relet taking account of fees voids and repairs

    The deposit really is a joke and covers very little, pet insurance some will cancel this .

    Regarding benefits well landlords are accused on one side of robbing the public purse and on the other for picking a tenant that is not on benefits over one that is.

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  4. LRC10

    The government really don’t see that they are creating a bigger monster here.

    Driving landlords out of and already desperate market will just lead to further shortages, rent increases and make it EVEN HARDER for people to find properties.

     

    None of these reforms are benefitting tenants, lets be honest here.

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  5. Russell121

    Over the last 3 years we have lost roughly 5% of our letting stock year on year. I would say 50% of those won’t be coming back to the rental market. They are the individual landlords who have had enough and who own 3/4 bedroom houses, bungalows and alike, the exact kind of property families need. The government had better start building. 

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  6. Eagle60

    As a landlord I’m still more adverse to tiny children than pets when it comes to damage.

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  7. Woodentop

    So government is now taken steps to impose its will based on what evidence? We all know the answer to that, but in reality it is taking steps that does not bear any resemblance to what is actually happening within 95% or so of PRS. I cannot for one minute get my head around the nonsense for the changes other than this is nothing more than a certain group of people imposing their personal values on the majority, come what may.

     

    This is nothing more than a personal vendetta that has been allowed to get out of control and I do point the finger at civil servants. This theme seen as anti-Landlord has been going on for many years with many changes of Housing Ministers.

     

    We have seen landlords leaving the sector because of anti-landlord rhetoric over the last couple of years. I guarantee things will get worse. Either landlords in England will see this as the final nail of “why do I bother” and get out before or soon after implementation and most certainly once they are on the receiving end of being bitten by the nonsense.

     

    PRS is what it says, Private Rented Sector. It is not social housing and imposing conditions that the free market has the right to say what goes on, is nothing more than draconian and possibly illegal within the terms of Business Protection Regulations where the state interferes with a free market. Where are the industry organisations that are supposed to represent the sector. Sat at the table enjoying the tea and biscuits!

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  8. Jimbo1531

    These comments are, as always, hilarious. It’s almost as if tenants are the ones paying all the money

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  9. Titsville

    We have decided to pull out of the rental market.  We had to serve a section 21 through solicitors. Our tenants left on January 6th.  Our current bill for repairs is £16 k.  We had to completely take the flat back to bare boards and renew everything.  Kitchen, bathroom, flooring.  The laminate floor had to be taken out as they acquired 4 ferrets and the wet urine was saturated between the boards and the underlay. Only now are we beginning to dissipate the awful smell.

    We secured date stamped photos and all of the invoices required showing expenses.  We even had a letter from the tenant from a year ago stating they were happy living there with no issues.  We also supplied a letter from the workmen stating how bad was the condition and the smell.

    We immediately put in a claim for the deposit ( only £400) to offset some of the costs.  Reeds Rains were very poor about pursuing this with the deposit scheme.  They told us there is a 95 day period in which the tenants may counterclaim.  We have just received a further email from them (after many such emails) and have been told that the tenants counterclaimed on May 18th (well out of the 95 day period) and they as the claim is in dispute no refund can go ahead.

    I note there is no mention of the deposit scheme and how it works.  In our experience it is a total farce.  We have had enough.  We only own the one property, it is ( or was) a retirement supplementary investment.  I note that 43% of the market belongs to single property landlords.

    unfortunately the government has over the years placed the burden of social housing onto landlords and as it has been pointed out, has caused a mass exodus and rent increases.

    Well, here’s one more joining the exodus.

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