When the Coalition Government came to power back in 2009 they promised a “Bonfire of Red Tape”, a wholesale scrapping of bureaucratic rules and regulations which were strangling businesses, and they promised that for every new regulation introduced, two would be removed.
Well, something went wrong in the private rented sector (PRS); it seems that this important part of the economy, and one of the biggest business operations in the country, got entirely forgotten when it came to removing “Red Tape”.
The irony should not be lost on landlords that the Deregulation Bill, a Bill with the stated purpose: “to make provision for the reduction of burdens resulting from legislation for businesses or other organisations or for individuals” should be used as a vehicle by Lib-Dem peers to re-introduce the failed Tenancies (Reform) Bill.
In fact, we seem to be in an era in the PRS of bureaucracy gone made, with every nation in the Union either planning or introducing onerous regulations on the private landlord. From landlord registration and licencing schemes through to extended tenancies, rent capping and restrictions on evictions, the proposals and Bills from all political parties begin to mount up.
Add to all of this the looming Energy Efficiency regulations coming in between 2016 and 2018 and you begin to get the feeling that the burdens on landlords over the next few years could be quite overwhelming, and especially given the fact that around 70% of landlords are managing just one or two investment properties as a side-line to their day jobs.
In my view the Tenancies Reform Bill, introduced as a Private Member’s Bill by Sarah Teather, has the potential to cause landlords the most trouble with its retaliatory eviction measure. It has been dubbed a lawyer’s charter and a gift to anti-social rent dodging tenants by the landlord associations.
But there is a good chance that this “retaliatory eviction” Bill will become law in this session of Parliament. Landlords will just have to bite the bullet and accept that: (1) their properties must be in tip top condition health & safety wise, (2) that they deal with complaints about defects promptly and efficiently, (3) that everything is documented as evidence for any subsequent legal battles.
The danger, as I see it, is when tenants struggling to pay rent start to realise they could use the anti-eviction rules to prolong their stay. There do not appear to be any consequences in the legislation for tenants being “creative” with their disrepair complaints, but the consequences for landlords could be dire: long periods without rent, damage to their properties and prolonged legal fights trying to convince the authorities who is in the wrong.
The “Licensing Lottery” is another issue which is worrying landlords. With around 40 towns and cities already introducing, or planning to introduce, borough-wide licensing, costing landlords on average around £400 per property, other councils are rejecting this route. It really is a post-code lottery if you are unlucky enough to have your properties in the pro-licensing council areas.
Where Manchester, Boston and Wirral councils, for example, continue their own projects aimed at eliminating “rogue landlords”, with the help of central government funding, and at no cost to local landlords, Liverpool goes down the route of city-wide licensing, so far the biggest such scheme in the country.
One cannot help thinking that these schemes are cynical money raising exercises, especially when we read that Liverpool Council, since announcing the licensing scheme, is cutting its Environment Health Services division, the department that would police the scheme, by up to 25 per cent.
It has been reported that the compulsory landlord licensing of 50,000 rented properties in Liverpool could raise around £15m for the council, all paid by landlords, or eventually tenants who may pick up the bill in increased rents.
The Residential Landlords Association (RLA) claims that tenants are being let down by a failure to properly enforce powers already available to councils to tackle poor housing conditions.
Even though central government has highlighted in reports its concerns about the ability of some local authorities to fund these statutory services, it now appears that a central government task force set-up to combat problems caused by rogue landlords has never met, not even once, in its two years of existence. That’s according to housing minister Brandon Lewis MP in responding to a freedom of information request.
There is no doubt that rogue landlords need to be eliminated, but not I would argue, at the expense of those responsible landlords who follow the rules and provide good value accommodation, which modern, safe and warm for their tenants.
If councils are serious about addressing anti-social behaviour in their areas they should take note of the councils who are doing this effectively, without resorting to borough-wide licensing, by allocating funds for task forces (councils have been allocated money for this from central government) to aggressively tackle the culprits, and only implement licensing selectively in specific problem areas, a strategy these schemes were originally intended for.
This approach would gain councils the support of the responsible landlord community, rather than completely alienating them.