The UK rental market is not as strong as previous years, and with 11 million private renters and 2.3 million landlords in England. According to the UK government website, these groups of people need to be safeguarded against further challenges to renting property.
Some industry insiders believe that under the current tenancy laws, the rental property legislations give tenants a lack of security towards their rented homes, especially with Section 21 ‘no-fault eviction’ clause which allows landlords to evict their tenants without giving reason.
Generally, tenants have 2-months’ notice to leave the property before a landlord can apply for a court eviction to have them removed from the property.
While the rental property is an asset owned by the landlord, there should be a duty of care toward tenants. In the past there have been reports of some landlords using Section 21 as a way of evicting tenants and claimed to be unjust, for example when a tenant attempts to negotiate rather than accepting a proposed rent increase, there has been a history of landlords turning to the ‘no-fault eviction’ as a way to remove tenants from the property.
The Renter’s (Reform) Bill was introduced to Parliament on the 17th of May this year, as an effort to deliver ‘safer, fairer, and high-quality homes’ to tenants across the UK.
Headlines of the proposed bill:
While these reforms provide tenants with some advantageous changes, it does provide some benefits for landlords.
While the aim of the Renters (Reform) Bill is to provide tenants with protection, the National Rental Landlords Association has raised concerns, that it may unfairly penalize landlords.
The National Residential Landlords Association claim the Bill lacks vital detail on how effective it will be for landlords to recover their properties when they have genuine intent to sell or allow for close family members to move into their rental properties.
Furthermore, as pointed by Ben Beadle, Chief Executive of the National Residential Landlords Association, the Government should consider concerns around landlords who let to students who typically have 12 month fixed-term contract to coincide with the academic year. Fixed-term tenancies would be replaced with rolling tenancies, meaning tenants pay rent weekly or monthly with no fixed end date. This could result in landlords not being able to guarantee a property to be available for the academic term-time.
Without the ability to plan around the academic year, landlords and students may not have the certainty that properties will be available when required. Therefore, this should be something taken into serious consideration as it could impact the student segment of the rental market.
With the Bill still being discussed in parliament, there is the potential for change for a more rounded piece of legislation. We should all be in agreement that everyone deserves a safe, clean secure, comfortable property they can call home, but for the landlords who are already facing a challenging time, should they be the ones on the back foot? For now, landlords have enough to contemplate.
Specialist lenders like West One can offer much needed solutions and navigate through cases using their manual approach to underwriting, meaning no matter how complex a case gets, borrowers are provided with suitable finances catered to their needs.
At a time when affordability and rental yields are two of the biggest challenges for landlords, West One look to provide solutions through product and criteria innovation. Whether lowering, minimum property value to £90k, which supports the north of England to mortgage product fees which increases affordability, due to a lower payrate.
For more information on services West One offer, please visit our website www.westoneloans.co.uk or speak to an expert on btlbrokersupport@westoneloans.co.uk or call 0333 123 4556.
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