Year: 2020

A senior Tory peer and consumer campaigner has just written an article in strong support and defence of the private rented sector, landlords and their agents.

Baroness Ross Altmann of Tottenham is a well known expert on social care, pensions and later life issues wrote on the Conservative Home website, that although she supports the eviction ban during the pandemic, she acknowledges that it has created as many problems as helping to solving them.

She wrote in an extremely pointed statement: “After so many months, I do wonder whether the Conservatives need to do more to show support for some of the landlords (especially small ones who own only one or two properties).”

She states that the eviction ban has protected anti-social tenants from rightly being kicked out of their properties, as well as praising many landlords who have helped tenants out when asked to, but are now themselves struggling with bills that must be paid.

She wrote that some private landlords invested in the sector to provide them with a pension, and in many cases have reduced or no rental income due to Covid-19, but “must still meet costs such as licensing fees, insurance, and maybe even utility bills for the property.”

Baroness Altmann calls on the government to support a new framework of measures to support hard-pressed landlords and tenants at high risk.

She suggests that:

– The government has to make it crystal clear to tenants they must, wherever possible, keep paying their rent as normal and that landlords should no longer be regarded as wealthy or as large firms, that do not need the rental income.

– The government should introduce a mediation service to provide assistance to landlords and tenants on rental arrears, because of the coronavirus, with agreed repayment plans.

– The court processes have to be made far more effective to reduce the time that normal repossession cases take, otherwise there will be little hope of clearing the backlog; she has even said that online hearings should be introduced.

– If in the near future local lockdowns are introduced then there must be planned strategies put into place; one such plan would be a time limited pause in repossession cases within the affected areas.

Altmann concludes: “The private rented sector plays a vital part in housing the nation. Some seek to paint a picture of tenants and landlords in constant conflict, but in the vast majority of cases they have been working constructively to address the challenges of Covid-19.

“Once the immediate crisis measures are relaxed, the proposals I have outlined here could engender a sustainable balance between the rights of renters and of landlord. But Conservatives also need to bear in mind the political realities, and must avoid causing long-lasting problems for landlords.”

Richard Merrick of PIMS said: “For once the PRS has enjoyed a very positive week with support from the government announcing a Stamp Duty ‘Holiday’, the £2bn Green Energy Fund and now a Tory peer defending landlords and agents.

“This makes a nice change from the usual vilification of private landlords by politicians, whilst living in their ‘gilded’ palaces completely shut off from the real world.”

Blog Post from PIMS

See details of our Guaranteed Rent Scheme here

A £266m package of help to support vulnerable people into long term accommodation includes possible options to use the private rental sector.

Housing Secretary Robert Jenrick, who launched the scheme over the weekend, says the funding is part of the governments Next Steps Accommodation Programme which has been created to cover property costs and support new tenancies for homeless people and rough sleepers following the lockdown.

Local councils can now apply for the funding which is expected to support around 15,000 people.

They can use the funding to house the individuals in accommodation owned by a university or social housing provider or the private rental sector.

In the latter category the Ministry of Housing, Communities and Local Government says the funding can be used for guaranteed rent or deposit schemes, mediation support, and training, or landlord incentives.

The closing date for applications from local authorities is August 20.

Blog Post from Letting Agent Today

See details of our Guaranteed Rent Scheme here

Further details of Chancellor Rishi Sunak’s £2 billion Green Homes Grant scheme are expected to be released next week, LandlordZONE has been told.

David Pierpoint, whose organisation The Retrofit Academy is due to be at the forefront of efforts to implement the scheme and bring all the stakeholders together, says civil servants have been in touch with the industry for several months as the scheme has developed, and that a ‘wider picture’ is imminent.

“No one really knows what the scheme will really look like yet and it will take longer to get the full details as they’re still working on them, but the basics of how the installation and supplier scheme will work – for example – are likely to be made public next week,” he says. Other details include how the vouchers will work, and which companies will be approved to do the work.

The Green Homes Grant scheme is expected to be an unprecedented bonanza of environmentally-friendly funding for landlords, but there are several obstacles.

One is that the window of opportunity is small – landlords can apply for the vouchers to fund retrofit green refurbishment work from September onwards, but the scheme will only run until March next year.

The other is that green retrofit industry has just three-and-half months to get ready.

“The industry already has an annual turnover of £1 billion, but from September onwards it’s going to have £2 billion of work added to it almost overnight,” says Pierpoint.

How will the Green Homes Grant work?
Landlords in England will be able to claim up to two thirds of a property’s green refurbishment cost with a ceiling of £5,000 per rented home.

This will include loft, wall and floor insulation as well as, it is rumoured, new boilers, with no limit on how many properties a landlord can refurbish.

As advertised, the scheme is a significant improvement on the previous and largely failed Green Deal, which required landlords to take out high-interest loans, and was eventually closed down.

Now, to claim the full £5,000 allocation of free vouchers from the new scheme, a landlord will have to have a budget of £7,500 per property, of which two-thirds will come from the government.

Alex Hunt of Sussex-based specialist building firm Bright Green Homes, says he is worried how the scheme will be implemented.

“There is a danger you’ll get plumbers recommending that a new boiler is put in, but often it’s the insulation that needs sorting first – there’s no point having a super-efficient heating system pumping out warmth when it immediately disappears through the walls and windows,” he says.

“It’s vital that the scheme takes a holistic look at each property and works out which work is going to create the best environmental outcome, rather than a hodgepodge of different work being completed that could be contradictory and not achieve the green revolution the government wants.”

Blog Post from Landlord Zone

See details of our Guaranteed Rent Scheme here

A new ‘breathing space’ scheme to give people in debt time to get proper professional advice and reduce the stress caused by impending legal action is set to go live next year following a consultation.

The Debt Respite Scheme regulations – which cover most debt including rent arrears – aim to give them a better chance to stabilise their finances during a 60-day moratorium on interest, charges and enforcement action while they seek help. It will take effect from 4th May 2021.

They could then enter a statutory agreement to repay their debts to a manageable timetable and would get legal protection from creditor action during this time.

The National Residential Landlords Association says while landlords would be restricted from using the rent arrears grounds under section 8, a tenant would still have to pay their ongoing rent.

– Advertisement –
Deputy director of campaigns Meera Chindooroy tells LandlordZONE: “The aim of the scheme is to provide the tenant with the space to agree a payment plan – landlords have a measure of confidence that the tenants who enter into it will engage with the process.”

Citizens Advice agrees that it’s an enlightened approach to debt management and will no doubt help many people struggling to make ends meet. But it adds that many tenants will need help with their finances long before the scheme is up and running next Spring.

The Government says that those who need debt advice often don’t seek it, and those who do get advice often don’t get the best experience because they leave it too late when their situation is at crisis point.

Debtors receiving mental health crisis treatment will also be able to enter a mental health crisis moratorium without engaging with this debt advice.

Protection will apply for the duration of their treatment and then for a further 30 days. If eligible, debtors can then access the 60-day moratorium.

Debt charity StepChange welcomes the move which it says demonstrates an increasingly enlightened approach to the treatment of people experiencing debt problems. Head of policy Peter Tutton says:

“We look forward to working on the detail of implementation constructively with the Government, to ensure that it fully meets the policy objectives of getting more people to the debt advice that they need, and then giving them a period of calm in which to begin the process of reaching a suitable solution to their problems without fear, harassment, intimidation or escalating cost.”

Blog Post from Landlord Zone

See details of our Guaranteed Rent Scheme here

The government has outlined new court procedures to address the expected backlog of cases when eviction proceedings resume on August 24.

For all applications made before August 3, the landlord or agent must notify both the court and defendant in writing that they wish to continue the case.

Without this reactivation notice cases started prior to August 3 will not resume.

Secondly, the landlord or agent should ascertain whether the tenant is shielding or is in some other way vulnerable to Coronavirus.

The landlord or agent must also itemise arrears in writing, ideally as part of the reactivation notice, if this is relevant to the eviction.

Finally the court officers are to have greater leeway over the timetable for proceedings to ensure social distancing and other safety measures can be ensured.

These processes will be in place until March 28 with an earlier review if circumstances change.

The National Residential Landlords Association has analysed the proposals and say there are two outstanding issues to be resolved.

“Although landlords will be required to provide any information they have about their tenant’s experience of coronavirus, there is no indication of how the courts will use the information” says the NRLA.

“Also there is no detail about how, or in what form a reactivation notice should be served. The NRLA is working to answer both of these points with the ministries of justice and housing respectively.”

Full details of the new procedures can be found here.

Generation Rent, the charity led by campaigning former-Labour Baroness Alicia Kennedy, has accused the government of having “snuck out its plans” over the weekend.

She says: “Clearly, the government doesn’t understand how scared renters are about losing their homes. As it stands, these rules alone will not help the vast majority of renters who are at risk of losing their home, and judges will not have the powers to prevent Section 21 no fault evictions or Section 8 evictions for rent arrears built up during the pandemic.

“Over half a million households are behind on rent, and urgently need reassurance that they will not lose their home due to the economic shock of Coronavirus, as the government promised in March. The government must use the final days of parliament to legislate to ensure that no home is at risk.”

Blog Post from Letting Agent Today

See details of our Guaranteed Rent Scheme here

An influential think-tank wants private rental properties to have a minimum EPC rating of B by 2030.

The Institute for Public Policy Research says: “Incentives should be matched with new regulation and enforcement actions to ensure compliance. “

Specifically for the rental sector it calls for the Minimum Energy Efficiency Standards to be gradually raised to at least B by 2030.

It wants the same minimum to be required across all private residential properties, including for owner-occupied homes, at the point of sale or when other renovations are carried out.

For some two years it has been a requirement under MEES for any new tenancies or tenancy renewals of properties rented in the private rented sector to have a minimum energy performance rating of E on an Energy Performance Certificate.

And from April this year this has also applied to all existing tenancies, even where tenants are staying in place.

Blog Post from Letting Agent Today

See details of our Guaranteed Rent Scheme here

New data from Hamptons International reveals that in June the average rent on a newly let property in Britain dipped 0.6 per cent below this time last year.

This marked the first annual fall recorded by Hamptons since February 2014 and a deceleration in rental growth from pre-lockdown times when rents were rising at an annual rate of 1.2 per cent earlier this year.

In June 2020, rents fell in four out of 11 regions monitored by the agency, with London recording the biggest decline.

The average rent of a newly let property in the capital dropped 4.5 per cent year-on-year in June, the biggest decline in six years.

This was led by a 7.4 per cent year-on-year fall in Inner London, marking the biggest decrease on record and all but wiping out last year’s rental growth of 7.5 per cent.

Meanwhile rents in outer London decreased 3.6 per cent year-on-year in June.

However if London is excluded rents continued to rise across the rest of Britain by an average of 1.3 per cent annually.

Increasing rental growth in the Midlands (2.9 per cent) and the North (3.0 per cent) outweighed rent falls in the South East (down 2.2 per cent), the North East (falling 0.7 per cent) and the East of England (dipping 0.2 per cent).

The North West recorded the strongest rental growth of 5.2 per cent, which is the highest rate of growth recorded in the region since November 2016.

Aneisha Beveridge, head of research at Hamptons International, comments: “Rising stock levels in the capital, particularly in Inner London, combined with falling demand from new applicants caused the record falls.”

She adds: “The effect of lockdown has resulted in fewer international tenants, particularly students, as well as an increase in the number of London tenants leaving the capital.

“However the flexibility renting offers has boosted demand in the Midlands and North.  Rents in the three combined Northern regions rose 3.0 per cent in June, six times the rate recorded in the same period last year.

“While the stamp duty changes … are most likely to benefit landlords looking to buy in London and the South, higher yields will continue to entice investors further North. Any additional increase in rental stock in London could put more downward pressure on rents.”

Blog Post from Letting Agent Today

See details of our Guaranteed Rent Scheme here

The housing minister says the resumption of eviction possession court cases at the end of next month must be done in such a way to priorities cases involving domestic abuse and anti-social behaviour.

There are fears that the backlog of cases built up during the Coronavirus eviction ban, plus the possible slower process required for court proceedings because of the virus, may lead to substantial delays.

But minister Chris Pincher, in a written answer in the House of Commons, has made it clear that “landlords and tenants have appropriate access to justice in cases that are not related to COVID-19, such as cases of anti-social behaviour and longstanding cases that pre-date lockdown measures being put in place”.

In response to a question by Labour MP Helen Hayes, Pincher confirmed once again that the ban would be lifted on August 23.

Pincher’s answer continues: “Landlords must follow strict procedures if they want  to gain possession of their  property, depending on the type of tenancy agreement in place and the terms of it.

“The government has also been working closely with the judiciary, legal representatives, the advice sector and housing sector stakeholders through a working group convened by the Master of the Rolls.

“This group is considering arrangements that will mean that courts are better able to address the need for appropriate protection of all parties in the current legislative framework once the suspension of proceedings ends.”

More details of new procedures for how possession cases are heard are expected to be revealed shortly.

Blog Post from Letting Agent Today

See details of our Guaranteed Rent Scheme here

The average rental asking price outside of London has hit an all-time high says Rightmove – whereas inside the capital, the figure is falling.

Asking rents outside London over the past three months averaged £845 per month, up 3.4 per cent on the same time last year.

But in London they are down 0.6 per cent compared to a year ago and down 2.8 per cent in the last quarter, as levels of total available stock have soared by 41 per cent compared to this time in 2019.

Rightmove says the situation is exacerbated by Airbnb and other short let landlords now competing for long-term rentals.

The portal says new rental listings dropped an average 50 per cent during lockdown, but are now up one per cent on the same time last year; total available stock is also up one per cent.

Overall rental demand is at a record high and so this may lead to further upwards price pressure except in areas of over-supply.

Monday is usually the busiest day for people enquiring about rental property, and it hit a record on Monday July 6; Rightmove adds that compared to this time last year demand is now 40 per cent higher across Great Britain.

Rightmove commercial director Miles Shipside says: “The pause in the rental market has led to some distorted figures over the past few months, especially in cities where landlords with short-term lets made the swap to instead try and find a long-term tenant.

“Both rents outside London and demand being at a record high isn’t good news for many tenants looking to move right now, especially as we know there will be even more competition for those attractive properties with more space, bigger gardens and a spare room.

“There are early signs that some existing London renters are looking to move further afield, adding to the large increase in the number of properties up for rent on Rightmove in the capital, so prospective tenants there could find there’s some room to negotiate especially if they are happy to sign a longer-term contract than usual.

“Many renters may feel they’ve been left out of the Chancellor’s recovery packages, but one glimmer of hope is that the temporary stamp duty savings may entice more investors to expand their portfolio. If this does happen we could see more choice for tenants and in turn prices may stabilise for a while, but it will take some time.”

Blog Post from Letting Agent Today

See details of our Guaranteed Rent Scheme here