In recent years, the extent and role of the private rented sector (PRS) in the housing market has seen significant changes.
The sector has grown considerably, with one in five UK households – 4.5 million families – now living in private rented accommodation, with a similar amount in social housing, according to recent figures.
A more diverse range of households, including families with children, are now accommodated by private landlords and for many it is providing long-term, rather than short-term, accommodation.
The expansion of the PRS has focused attention on the need to improve housing conditions in the sector.
The English Housing Survey estimates that in 2018 25% of homes in the PRS were in a condition that would fail the Decent Home Standard – around 1.2 million homes. This was the highest proportion of all tenure groups.
Privately-rented homes were also the most likely to have at least one Category 1 hazard under the Housing Health and Safety Rating System (HHSRS).
So, it’s no surprise that in 2020 landlords and letting agents have been hit with a raft of new legislation, including the Tenant Fees Act; new rules on money laundering extended to cover letting agents; and Capital Gains Tax on profits made through the sale of any property that isn’t a main residence.
It is essential that landlords and agents prepare their properties to ensure they are compliant with recent and new laws that are coming into force, or they could face heavy fines.
Below is an overview of some of the latest rules the industry needs to stay on top of…
From 1 June 2020, private landlords in England have been required to have the electrical installation in their rental properties checked by a qualified electrician to ensure that they are safe.
Electrical installations must be inspected and tested prior to the start of a new tenancy from 1s July 2020 and checks must be carried out on any existing tenancies by 1 April 2021.
These checks must then be carried out on a five yearly basis and a copy of the most recent electrical safety condition report (EICR) must be provided to both new and retained tenants.
The landlord is responsible for making sure that the person who completes the check is suitably competent. Using an electrician or firm that is a member of an accredited registration scheme operated by a recognised body will give you the confidence that this has been achieved.
You can use the search facility on the Electrical Safety First website - find a registered electrician near you.
Evictions and Section 21
New legislation has now been introduced so landlords must now give tenants six months’ notice before they can evict until March 2021, except in the most serious of cases, such as incidents of anti-social behaviour and domestic abuse perpetrators.
The stay on possession proceedings was extended until September 20, so no tenant was legally evicted for six months during the height of the pandemic. For the more serious cases, notice periods have returned to their pre-coronavirus levels and landlords will be able to progress significant rent arrears cases more quickly.
Landlords must now provide at least six months’ notice period prior to seeking possession through the courts in most cases, including Section 21 evictions and rent arrears under six months. Notices served on and before August 28 are not affected by these changes and must be at least three months.
Landlords can seek possession for the worst cases including:
• Anti-social behaviour (now four weeks’ notice)
• Domestic abuse (now two to four weeks’ notice)
• False statement (now two to four weeks’ notice)
• Over six months’ accumulated rent arrears (now four weeks’ notice)
• Breach of immigration rules ‘Right to Rent’ (now three months’ notice)
In addition, landlords need to set out in their claim any relevant information about a tenant’s circumstances, including information on the effect of the Covid-19 pandemic. Where this information is not provided, judges will have the ability to adjourn proceedings.
The notice remains valid for six months where two months’ notice is required and valid for four months where more than two months’ notice is required. Where validity of the notice ends, a new one will need to be served providing that court action was not started.
The Green Homes Grant
The UK government has opened applications for the Green Homes Grant scheme, which allows landlords and homeowners to apply for a grant of up to £10,000 towards the cost of making homes more energy efficient.
Under the scheme, landlords and homeowners in England can apply for a voucher to fund at least two-thirds of the cost of hiring tradespeople to upgrade the energy performance of their homes, up to a maximum contribution of £5,000 or up to £10,000 for lower-income households.
The aim of the Green Home Grant is to upgrade over 600,000 homes across England, with the government saying that this will save households hundreds of pounds per year on their energy bills. The scheme is now open for applications.
*Lee Power is head of business development at Canopy