Things are in a better condition all round

Last time I wrote about the Housing and Planning Bill its measures were looking good for private renters. Since then, the Bill has passed through committee stage in the Commons and the government has confirmed that they want to crackdown on rogue landlords and will consider further reforms. I’m now positively optimistic that the Bill will improve things for renters.

When we wrote our Safe and Decent Homes report last year it was clear that a sea-change was required to make private rented accommodation suitable for families – after all, a third of privately rented homes would fail the government’s own Decent Homes Standard.

To shake up the sector, we need laws that protect and empower renters. We need clarity from the government that they see the main business of private landlords as providing decent homes for England’s families. And, as a vital backstop, we need well-resourced and empowered local authorities to enforce standards and clamp down on the minority of rogue landlords.

The Bill will make real progress on this last point: in fact the government has already strengthened some of its own measures to tackle rogue landlords during committee – and landlords have themselves welcomed the recognition that a few landlords give the rest of the sector a bad name

As it stands, the Bill will help local authorities to understand the local private rental market by giving them access to data on landlords who have protected their tenants’ deposits. It will also create a blacklist of rogue landlords convicted of housing offences. There are also plans to strengthen the test for landlords who rent out licensed properties to make sure they are suitable landlords.

For the first time, local authorities will be allowed to hand out £5,000 penalty fines to rogue landlords. Government may even increase the fine to provide a stronger deterrent to landlords. It’s absolutely crucial that government allow local authorities to keep the proceeds of these fines, to give them the resources and incentives to carry out enforcement.

The Bill will also extend the use of rent repayment orders, so tenants can reclaim rent they have paid if their landlord hasn’t dealt with poor conditions. Where housing benefit has paid the rent, local authorities will be able to pursue a claim and keep the money.

The government will also create banning orders so that the minority of landlords who repeatedly break the law will be stopped in their tracks. Government are now planning on putting landlords in prison if they continue to operate when they have been banned. It’s a welcome recognition that a minority of landlords need driving out of the market all together.

So, there is much to be happy with. But as ever, more to be done.

As the Bill passes through into the Lords, government should now turn its attention to introducing laws which protect and empower renters and provide vital clarity about the standard of accommodation we expect our families to live in.

This is an opportunity to save lives and really drive up standards:

As I said, there’s more to be done. Let’s hope the government keeps on course and steers the Bill to being a genuine sea-change for renters. The one in four families in England that rent privately depend on it.

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2 Comments
  1. All these law changes are driving me up the wall and it is job in itself to keep up to date with all the changes. It is easy for a good landlord to be labelled a rogue landlord, because they were not aware of a recent change in the law.

    Owners of empty homes receive letters they should rent them out. Why should anyone be forced to become a landlord involuntarily.
    It is a burden keeping up with the regulation.

    We had some laws changes in October 2015. Most of the legal changes are down to Shelter.

    George Osborne struck a massive blow in the previous budget, where he changed the tax system.

    Tenants group claimed landlord were getting some sort of special treatment by getting tax relief on interest (even though businesses can borrow money to factories).

    In ‘simplistic’ terms, if the rent is £1000 and the mortgage interest is £900. The profit is £100. Someone paying 40% tax will pay £40 tax. The net left over is £60 profit. With the new tax changes. The profit will be £1000, as the interest of £900 cannot be deducted. At 40% the tax bill if £400. The landlord needs to find another £300 cash. The rental is making a loss of £300. (the example has been simplified to explain the implication for those who don’t understand accounting).

    The tax is designed to put landlords out of business. The US interest rates have already increased. It is a matter of time, UK interest rates go up.

    I can imagine a scenario, where the roof leaks and I have no money to repair the roof, because I just had to pay the tax. So for me, if I can’t provide a good service to my tenants, it is time to leave the sector.

    The tax will not apply to hedge pension funds who move in to the BTL sector, as it does not apply to limited companies.

    The only landlord who will stay in the sector will be those who don’t pay tax and ignore or are ignorant of regulations.

  2. “Bill will help local authorities to understand the local private rental market by giving them access to data on landlords who have protected their tenants’ deposits”

    So it is a database of good landlords who have complied with the law!

    “For the first time, local authorities will be allowed to hand out £5,000 penalty fines to rogue landlords.”

    It seems like parking fines, where councils will be incentived to profit from this.

    Most landlords know the end of BTL is coming!

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