In a report commissioned by the Tenancy Deposit Scheme’s sister charity 'The TDS Charitable Foundation', Kate Faulkner says that the overabundance of rules and regulations are creating confusion amongst agents, landlords, tenants and enforcement bodies.
Faulkner, founder of ‘PropertyChecklists’ says a typical English buy-to-let investor must now comply with around 150 rules and regulations and even more if they want to let a property to someone in receipt of benefits. Of these 150, some carry hefty fines, some are life threatening and some are so complicated, not even the experts are entirely sure about the rules. Below is a review of some of the main changes that have come into place in the private rental sector over the last 2 years:
Right to rent
At the beginning of 2016 the Right to Rent scheme launched across the whole of England. Any landlords or agents that do not supply valid documents proving their tenants right to reside in the country to satisfy the requirements of the Immigration Act 2014 now face up to £3,000 worth of fines per breach.
All applicants must now provide a valid passport and if necessary work permit, the passport must be checked in person to verify that it matches the applicant. Without a valid passport and/or work permit, the tenancy cannot go ahead.
Smoke and carbon monoxide alarms
In October 2015, new Smoke and Carbon Monoxide Alarm Regulations were put in place and failure to comply can result in a £5,000 fine. The new regulations state that a smoke alarm must be fitted in each storey of the property and carbon monoxide detectors must be installed in any room with a solid fuel burning combustion appliance. Each smoke alarm must also be tested and working on the first day of every tenancy.
The Deregulation Act 2015
The Deregulation Act 2015 contained several changes that affect residential landlords, most importantly the serving of Section 21 notices. Section 21 notices are served upon a tenant by an agent or landlord to end the tenancy so the landlord can gain possession of the property. The changes that were introduced mean that not only was a new Section 21 6A form created, but a landlord can no longer serve a Section 21 notice within the first four months of the contractual term of the tenancy. Furthermore, the requirements to serve a notice when the tenancy is periodic in line with rental due dates is no longer prevalent.
Along with these changes, extra provisions came into force with the Deregulation Act 2015 relating to retaliatory evictions from landlords. These changes mean that if a tenant complains to their agent or landlord regarding the condition of the property and they do not receive an adequate response within 14 days, then the tenant can then approach the council who can issue an improvement notice and the landlord is then unable to serve a Section 21 notice for 6 months from the date of the notice. This was put in place to stop landlords removing tenants that report maintenance issues.
EPC legislation changes
With effect from 1st April 2016 tenants can request consent from their landlords to carry out energy efficiency improvements to privately rented properties. The landlord is now not able to unreasonably refuse consent. It is, however, the responsibility of the tenants to ensure that the works are funded and the intention is that no upfront costs should fall on the landlord, unless the landlord agrees to contribute. There are separate regulations requiring properties to be brought up to an E rating on an Energy Performance Certificate (EPC) which will become effective from the 1st April 2018
Unfortunately, these are only the tip of the iceberg, there are many more to consider such as changes to mortgage tax relief, stamp duty tax changes, the incoming banning of letting fees, the housing and planning act 2016 and so on with more to follow in late 2017 and beyond.
If you would like any advice on these many legislative changes, please get in touch today.
Angharad Trueman – Operations Manager