The National Association of Estate Agents (NAEA) and Association of Residential Letting Agents (ARLA) launched their 2015 pre-election Manifesto Tuesday at the third consecutive NAEA Conference, Agents of Change.
Over the previous six months NAEA and ARLA have done the rounds and met with property professionals, politicians, experts and campaigners across the UK to try to understand their plans, hopes and fears for the housing sector.
Out of this they claim came three fundamental concerns: lack of supply, a need for more regulation in lettings and sales, and appropriate taxes across the whole property spectrum.
Mark Hayward, managing director of NAEA, commented:
“Britain is standing today on the precipice of a crisis in the supply of housing. We are simply not building enough homes to meet burgeoning demand from both the sales and private rented sectors.
“We are growing as a society, and our needs for housing have developed from what they may have been previously. But what still rings true is that everyone has a universal right to a home. And our deep-rooted concern is that government policy on housing, as it currently stands, cannot deliver on this requirement.
“Providing housing, or more importantly homes, requires finance, suitable land, time and skill. Policymakers seem to have forgotten this. Housing cannot be a political football for future governments to use to score points against each other. Ultimately we need to take the politics out of housing. We know this is easier said than done. So instead we ask for all future parliamentarians to maintain a long-term progressive view and to deliver on our manifesto commitments.”
Commenting on the Manifesto’s call for greater regulation in the PRS, David Cox, managing director at ARLA, said:
“Britain currently maintains a two-tier private rented market, consisting of those who operate to professional standards and those that do not. Consumers often do not know the difference between the two, thus the onus falls on them to be able to tell the difference. Our agents are already regulated and operate to the highest professional standards. They are fully qualified and we offer tenants and landlords client-money protection.
“The certainty we provide should not be the gold standard, but what every consumer should demand from their agent. It is imperative therefore that letting agents be members of a client money protection scheme, and that regulation be tightened for the entire industry. Greater regulation for letting agents in particular will ensure fairness, a level playing field and the removal of those agents who bring the industry into disrepute.”
The manifesto calls for all letting agents to be under a legal obligations to be members of a client money protection scheme and that there should be “greater regulation for letting agents” to ensure fairness and to remove the minority of rogue agents.
However, the manifesto warns that imposing an outright ban on letting agents charging fees to tenants in England, Wales and Northern Ireland would be a detrimental step.
They argue that averages fees charged by ARLA agents is £202, an amount which covers a range of critical checks and administration duties, ensuring a smooth and transparent transaction between agent, landlord and tenant. Banning fees, they argue, will result in tenants paying higher rents
The manifesto highlights the need to tackle the housing shortage by encouraging more institutional investors with tax incentives to move into the Build-to-Rent (BTR) sector, which would be following examples set by France, Germany and other countries, where BTR is a bigger and a significant part of their private rented sectors.
NAES & ARLA also maintain that the private rented sector (PRS) landlords should be seen as carrying out an ‘entrepreneurial business activity’ for Capital Gains Tax purposes, rather than simply an investment which is the case at the moment. This would allow landlords to take advantage of the same level of roll-over CGT relief available to other businesses when they are selling and then reinvesting in properties.
ARLA managing director David Cox has said that says Britain currently maintaining a two-tier private rented market “consisting of those who operate to professional standards and those that do not.”
A full report of the NAEA and ARLA manifesto recommendations here
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