In the third in a series of blogs for LandlordZONE on rental reform, Sean Hooker, Head of Redress at the Property Redress Scheme, shares his reaction to the Bill and what stands out for him.
So, May Day came and went, a King was crowned and then boom, the big surprise to us all; the long-awaited Renters (Reform) Bill was finally laid and landed on the doormat - just in time for us to get our heads around it before Parliament rose again and MPs jaunted off for the Whitsun Recess.
It is not an easy read and those who have waded through the quagmire of legalese have been trying to understand why a 'Z' is used to insert a new clause into the existing laws are no doubt shell shocked.
Of course, guidance to the changes has slowly emerged and this will make the whole process easier to understand. But the bill is a weighty piece of work and the changes will be profound, albeit exactly how, only time will tell.
What I can say is that whilst it is the most fundamental change to renting in a generation, as of today absolutely nothing has changed, and it will be the best part of a year before any of the reforms hit the statute books or at least are introduced.
Many other bits have considerable implementation periods built in, so to coin the phrase that is on the T-Shirt Goodlord gifted me, 'Keep Calm and Carry on Letting'�.
This said, I was quickly invited by all and sundry, to give my initial thoughts on the legislation. To be fair my musings were just a helicopter view of the Bill, which itself is pretty much what was in the Government'�s White Paper and whilst some sections are quite detailed in the changes they propose, such as the change of tenancy type and the abolition of Section 21 and the introduction of new grounds for Section 8, others are vague and the liberal use of Henry VIII clauses or delegated powers, will mean the finer details of how this is all going to work remain elusive.
However, I thought in this blog, I would briefly look at what, on paper, should be one of the easiest changes to understand but to me may well prove the elephant in the room as far as the tone and perception of the legislation is concerned. And when I say elephant, I more accurately should say, dog, cat or practically any other creature in the menagerie that a 'hooman'� can keep as pet legally in a residential home.
Despite being one of the White Paper'�s key points, it was not certain that, given several attempts to reform the law had been attempted by Private Members'� Bills, it would make the cut. It did, so if enacted as it stands, thereafter the right to keep a pet would become an implied term by law.
This changes the default of no pets, to such a position, that a landlord will have to provide a valid reason to exclude an animal. This the Government hopes will change the sector to being pet friendly. Some vainglorious hope!
Believe you me, this is a big deal and given the scale of the other proposals to the market, this one reform will attract a hugely disproportionate amount of attention and the expenditure of vast amounts of frenzied debate on both sides. This is England after all and nothing provokes more sentimental emotion than our adopted family members, be they canine, feline or arachnid!
Unfortunately the view out there is that the private rental market is very anti pet and certainly this makes for the perception that the private rented sector is inferior and not the choice of huge numbers of tenants.
Many tenants who want to have a pet are asked for, or even offer to, pay a higher rent on the basis that the landlord wants protection from pet damage and cleaning, but believe a standard deposit is insufficient to cover the extra cost.
Whilst a good deal of this is of the Government'�s own making, as it was they who imposed the cap on deposits, the fact that having a pet poses a higher risk does not always stack up.
I can feel the blood of many readers boiling, but stay with me, the figures out there show that pet friendly tenancies as rare as hens'� teeth. Official figures indicate that only 7% of properties advertised state pets are permitted, yet demand by tenants has increased by 120% over the last few years.
This is backed up by figures I obtained from one of the big portals, which shows that only 3.49% of their adverts state that pets are allowed and 17.46% say that they are not. Now that leaves 79.05% that do not even mention pets, but even on those pet friendly listings many, unlike Postman Pat'�s cat, are not black and white with all sorts of caveats and conditions imposed.
It is also clear that where adverts exclude pets, this is not the view of the letting agents who post them, but the subjective requirement of the landlord who insists on a blanket ban come what may. The number of phrases used in the verbiage that indicates an apology is palpable. At least they are being honest.
More concerning is where the advert is silent on pets as, these may break material information disclosure rules by omission under the Consumer Protection Regulations, especially if the prospective tenant, after applying for the property or viewing it, is told no pets or discounted from being selected on the basis of being or wanting to be a pet owner.
The new proposals, in my view, will make this an illegal practice and property agents will have to get their houses in order and ensure the descriptions on property portals are clear on pet provisions.
This said the suggested provision in the bill, dealing with the request from a tenant to keep a pet, would make it mandatory for a landlord to provide a valid reason for denying a request to keep a pet so long as the request is made in writing.
That written request will require the tenant to provide a statement describing the animal, although I have to admit, this is a bit vague in terms of the information that would be adequate, but evidently more than 'four legs and a tail'� would be required.
The legislation attempts to define what a pet is, with the options of keeping an animal for personal reasons, companionship or ornamental reasons or any combination of these being the options given.
The ornamental one amused me, as the image of placing a cat onto your mantlepiece for show, would soon lead to the destruction of its fellow ornaments! We will not go into what personal reasons could mean but enough said. It will come down to interpretation and here I think the redress schemes will play a part.
Herald the era of the pet reference, where a prospective pet owner may need to provide a whole host of evidence to support that they and their animal are up to the mark. The irony of this, is that a furry friend may be required to provide more proof of suitability than their master as there is no legal requirement to reference a human being.
The reason I believe this will be the case is that, whilst it is clear the timescales of forty-two (days) allowed for in the Bill for a landlord to respond to a written request by a sitting tenant, may be the answer to 'Life the Universe and everything'� as in the Hitch Hiker'�s Guide to the Galaxy, it may not be a realistic timescale for lettings when a tenant turns up with a pet in tow and wants to move in a week next Thursday.
The status of the pet will need therefore to be determined up front. Whether this means tenants sneaking the pet in the back door remains to be seen.
The other major issue will be defining when a property is unsuitable for a pet or particular type of pet, or the number of them. Animals grow, some to a surprising size, and of course left to their own devices can breed, so allowing one small dog may well end up with a creature the size of Cerberus and a litter of carpet chewing hell hounds.
I have used the example of a Great Dane on the 33rd floor of a tower block, which is based on a real case, only the issue we dealt with, was the dog was left tied to the railings of a flat'�s balcony and the agent, who was passing, spotted it leaning over the edge barking at all and sundry and was fearful it would jump off and end up at the end of an unintended gallows.
He therefore entered the property without permission to 'rescue'� the dog, much to the bemusement of the female tenant emerging from her shower in a towel.
Other genuine reasons such as restrictive covenants in leasehold properties are provided for in the proposals, however how it will all work with house-sharing or students, where co-tenants may have allergies or phobias, remains to be seen. More work for redress me thinks!
Turning to the requirement for insurance, these on the surface appear to be reasonable and should dampen down the calls for reinstating higher deposits or raising the cap, or indeed the need to ask for extra rent.
But there are many challenges to finding the products, the right pricing needs to be determined and who and what the policy covers will need to be ironed out. These will come out in the wash as the insurance sector starts to adapt to the new environment and crunch the numbers. We will no doubt revisit this journey many more times before the right solution is found.
What is undeniable is this part of the Bill will create headlines, but let's seew whether it's a dog'�s dinner or the cat who got the cream. I leave you as I often do with the words of Winston Churchill, who sagely pointed out, 'I am fond of pigs. Dogs look up to us. Cats look down on us. Pigs treat us as equals.'�
Visit Total Landlord'�s Renters (Reform) Bill hub for more information on the Bill and read their article, Renters (Reform) Bill: will landlords have to accept pets soon?
You can also hear my initial response to the Bill in a special edition of The Property Cast with property expert Kate Faulkner OBE.