The government’s housing minister in the Lords has warned private landlords that mandatory membership of a redress scheme is around the corner.

In a reply to question to Baroness Ritchie about the government’s ongoing eviction mediation pilot, which he says is still being assessed, Lord Greenhalgh said the government remains strongly committed to bringing in redress for landlords.

Letting agents are already required to be a member of a redress scheme which, for a fee, mediates between tenants and agents over disputes. These issues often include poor service, rent not being passed on and shoddy maintenance work.

But landlords are not included in the Letting Agency Work and Property Management Work (Approval and Designation of Schemes) (England) Order 2013 which brought in mandatory membership in 2014 for lettings agents.

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This will be a thorny issue for the government to untangle – for example, will a landlord have to join a scheme even if their property is managed by an agent, and which redress scheme would a tenant take a complaint to if both agent and landlords are members of different schemes?

hooker

“These issues need to be thought through and resolved before the legislation is prepared,” says Sean Hooker, who heads up the Property Redress Scheme. It is one of the two government-approved bodies, along with The Property Ombudsman.

“Nevertheless, all landlords registering with a redress scheme would mean that the whole private rental sector would be accountable to a complaint process.”

DIY operators

Approximately half of all landlords use a letting agent and that means over a million landlords are DIY operators and would be covered by new redress legislation.

“This will ensure that all tenants have access to redress where they have a legitimate complaint about their home, and will also make it easier for private landlords to understand their obligations,” said Greenhalgh.

The issues remains high on the political agenda – in April an ITV investigation in to ‘mouldy homes’ in the UK called for a better system to handle maintenance and repairs complaints between landlords and tenants.

14 COMMENTS

  1. Does that mean landlords can get redress against tenants causing condensation, untidy property, and rent arrears as, as far as I’m aware, this is a mutual agreement where either side can break the rules? No. Thought not.

  2. Who pays for this?
    Obviously the landlord, but the money will ultimately come from the tenant in the form of increased rent.
    All those who claim to be helping tenants don’t care at all about them.
    It’s the poor tenants who pay for all these regulations.
    Just like it’s those that have to rent are paying for the net zero carbon fiasco via EPC costs that must also be passed onto them.

    • No as lodgers aren’t tenants.
      This redress scheme is for LL with tenants.

      It also WON’T apply to SA or FHL.

      Of course it could be that Govt decides that any LL whatever they let out as will need to join the redress scheme.

      I can’t see how Govt would ever be able to detect who has lodgers or how many.

      Govt is principally concerned with tenants.

      Lodgers by their very nature have little legal tenure so it ISN’T really worthwhile Govt bothering with them.

      Same with SA and FHL.

      However should Govt do the sensible thing and allow ALL lodger income to be tax free there could be a legitimate case for live-in LL to be compliant with relevant letting regulations.

      This will never happen so live-in LL DON’T have anything to concern themselves with.

      I doubt any live-in LL receives anymore rent than £7500per tax year.

      Even if they do officially they DON’T!

      Govt should just recognise this fact and make all lodger income tax free.

      This would encourage many more OO to let spare rooms.

      This would greatly assist older OO who are rattling around in larger family homes.

      They could take on lodgers and spend a lot of time away from their home visiting once per month.

      It would enable such older OO who tend to be asset rich and cash poor to be able to utilise their family home as an income earner.

      It would generate far more income than a pension.

      So with a 4 bed property that could be £2100 lodger income per month leaving the 4th bedroom available.

      Of course HMRC would need to change regulations that make anymore than 2 lodgers be considered as a lodging business which would cancel PPR for the period more than 2 lodgers occupy.

      Govt needs to encourage far better use of OO property.

      Encouraging tax free Lodger income no matter how much it is will be the best way to ensure millions of spare rooms are utilised.

      • Sorry Paul. You seem to have great insight that i don’t on the matter of redress. I am sure you are aware that the tenants fee ban includes excluded occupiers/tenants, right to rent checks are a legal requirement for lodger landlords and the let property campaign also specified that they are also focused on tax dodging live in landlords.

        So it wouldn’t be a shock if live in landlords are too required to be part of redress seen as the lodger market is big and fraught with rogues exploiting renters in this tenure. It is an informal market that needs safeguards for both sides.

  3. Sorry , but I am being a bit thick here but how does increase costs to the landlord necessarily result in an increase in rent to the tenant ? I can’t put my rents up above market rates in my area ( Notts / Derbys ) just because I have additional expenses e.g. electrical safety checks. I just have to take it on the chin / hit in the pocket !

    • I totally agree with you. In any event, these costs can be used as legitimate expenses against property when making tax returns.

  4. I thought tenants already had a redress scheme by referral to their Local Authority, which has a legal duty to ensure properties are fit to live in. Thus is certainly the strong impression given by the TV show Nightmare Tenants, Slum Landlords – this is what lovely Ozzie and her team deal with in Harrow.

  5. This redress scheme will cause mass homelessness.

    How can a fraudster LL be a member of such a scheme!?

    A fraudster LL is any LL not complying with the terms of any mortgage.

    Also not complying with the buildings insurance terms.

    Not carrying out RTR checks.
    Letting a property not EPC compliant.

    There are so many fraudster LL who I presume will not qualify for this redress scheme they will have to adjust their fraudulent tenancies to legal ines.

    This will cause many LL to give up AST letting.

    So for the 300000 accidental LL they will need to obtain CTL from their residential mortgage provider.

    If they DON’T then they would be fraudulently letting.

    Fraudster and criminal LL are now on notice that they need to regularise their lettings.

    Many fraudster LL will have to stop letting.

    This redress scheme is a National LL Licensing scheme in all but name.

    These criminal LL can ALWAYS sell up.

    Problem will be for the million of tenants that will be made homeless.

    Of course for compliant LL this will be great for business.
    Far fewer LL and millions of homeless tenants.

    As I predicted years ago tenants are now having to offer sealed bids.

    There will be millions of aspirant tenants and about 2 million rental property shortfall.

    Can only mean rents increasing substantially.

    When this property redress scheme starts there will be a tenant homelessness crisis.

    I DON’T believe Govt has any appreciation of how many fraudulent tenancies there are which will be revealed by a Property Redress Scheme.

    • And after Shelter and their cronies start kicking off about this sudden homelessness the government will punish LL in some way.

      • Can’t see how fraudster LL can be forced to let if their letting offer is fraudulent.

        300000 allegedly accidental LL have mostly not bothered to obtain CTL from their lenders.

        Obviously they do this as lenders penalise borrowers with increased IR erc.

        Some even refuse CTL or allow only for a year or so before requiring mortgage change.

        So fraudster A LL keep quiet.

        I DON’T blame them.

        If I was in their position I would do the same.

        But a redress scheme would find out all these fraudster accidental LL.

        Govt is opening a very large can of worms with this redress scheme.

        I DON’T believe it has clue what it is doing as far as the ramifications will be for tenants.

        Govt naively seems to believe that all letting of properties are done so in complete conformity will lender; insurance and Council conditions.

        The redress scheme will reveal this ISN’T the case.

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