Well it has been an interesting month for landlords hasn’t it? Or are you simply just not aware of what is going on?
I wouldn’t be at all surprised. One of the biggest downsides of the property industry is that it is run by government. Now don’t get me wrong, I believe passionately that this industry should be properly regulated and professionally run. Just currently it is not! We currently have (I am told by the Sunday Times), over one hundred and fifty acts of parliament and a further four hundred regulations! Yet we don’t have to be regulated. I think that is rather silly, don’t you?
The trouble is that the legislation that is passed, is often very badly communicated to both the industry providers (Agents and Landlords) as well as the public in general, but more specifically tenants. And quite often the consequences of their actions have generally not been properly thought through.
Just wait until you read my first update, that indeed is a classic case where, if you follow the governments advice, you could possibly fail in your attempt to get your tenant to leave, as bizarrely their form is not yet fully legal! Why? Because the government has not got either the money, or the infostructure, to roll this information out and because our industry is unregulated that means it is normally chaos to find out what is happening.
This is where your agent can be invaluable to you. You pay agents for a reason; the good ones are there to help you. Indeed, we have saved our landlords literally millions of pounds over the years and that is why they come back to us. Time and time again!
If you have ever read my blogs before, you will be aware of just how complicated this industry is, the issues are quite simple. Difficult legislation, poorly communicated. Making it virtually impossible for a landlord to manage his property legally, which of course leaves him (or her), in a very financially unstable situation. Most of the fines, penalties and sanctions these days are unlimited (or often well over £5000 per offence mark) and they now most also carry a statute of limitations, giving the tenant (or claimant), six years to make a claim against you!
This is why a good agent is worth their weight in gold! Always look for an accredited agent. That means they have access to the best training available, the best legal helplines and are most likely to keep you legal and profitable because they know their industry.
We have stringent new data laws that came in to force in May 2018 where you have to adhere to very strict protocols, not only with the data you have but also how you store and use it.
To be fair, the government are working hard to regulate this industry and the main buzz word for the last two or three years has been “Landlords, are Businesses”. However, what this actually means is that the government now regards being a landlord as having a business. Although that may raise your profile within the community. It also leaves you wide open to larger penalties. i.e. If you fail to do a Legionella Risk assessment” on your property at the appropriate time and somebody was to unfortunately die of Legionella poisoning, by law you are liable to a £20,000 fine. However, as you are now regarded as a business, the injured parties (partners, husbands, wife, parents etc.), now have the right to sue you for “Corporate Manslaughter” not just negligence. So now you could be talking £millions!
My first update is a legislative one and I am going to pass this on to you, the way it was sent to us by our Industry legal helpline (TFP), including the links to help you, should you need to issue a Section 21.
It is really important if you are managing a property, that you read this update, as the law (not for the first time) is proving to be very unhelpful and indeed mirrors my thoughts on how the government are managing the private rented sector.
Please note this information ONLY applies to section 21 notices for England.
You will have undoubtedly heard in the media about “the new section 21 notice”. We are emailing you to explain why TFP have not told you there is a new one to download as you subscribe to our documents.
On 8 August 2019 The Ministry of Housing Communities and Local Government (MHCLG) “made changes to the Form 6a”, However, as the form 6A is a notice prescribed in law, there is no new section 21 notice in law until a new statutory instrument is passed.
This means that the current Form 6A on the gov.uk website https://www.gov.uk/guidance/assured-tenancy-forms#form-6a is not a valid prescribed form and should not be used and you should continue to use the form 6A in your Forms regulations, or use the link below.
The TFP Form 6A uses the exact wording of the regulations and ignores the changes MHCLG have been making. This is because we can be sure the one in the law has to be accepted in the courts whereas you would be relying on the goodwill of the court to use any other version. This is an unnecessary risk and we are looking after you best interests by keeping to the version in the law. For this reason, we do not recommend using the version of the form on the link above.
The correct link to the legislation that prescribes the form is: The Assured Tenancies and Agricultural Occupancies (Forms) (England) (Amendment) Regulations 2019.
I think that says it all 😊!
The second update although of national interest, is primarily for landlords with properties in Newcastle. The government have just sensationally blocked Stoke-on -Trent Council’s application, for a similar Licensing scheme to the current Newcastle council’s plan. This means as it stands that it is unlikely that Newcastle can progress their scheme without government approval.
As you are no doubt aware, in November 2018 Newcastle City Council went into a “Public Consultation Period” with its landlords and the general public. Where they wanted to apply both additional and supplementary licencing, to all rental properties, within the city. This basically, means that every property (in certain designated areas) in Newcastle, would require a licence. In my opinion a great idea but in reality, the facts appear quite different.
Currently all 5 bed H.M.O. properties are already licenced so these measures are in addition to the current situation. It is worth noting, that an HMO (House of Multiple Occupation), is a property occupied (rented) to three or more unrelated people.
From a proposed date next year, properties would be subject to additional licencing (That is three and four bed only, as five or more are already licenced), at a proposed price of £750 for a five-year licence. The one and two beds in central Newcastle would be subject to Selective licensing at £650 for a 5-year period. This would bring the council (at my last estimate), an additional revenue stream of £2,585,500 per year for five years with the total £12,927,500 being paid up front! Yes £12Million!
Although the rationale behind this scheme given by the council was to raise the standard of Landlords and their rented properties. This argument fell down when they said that they were implementing this initiative as they had received over one thousand complaints regarding bad landlords in the city. However under questioning from the floor, then admitted that they had not actually prosecuted one landlord! You would not be alone in thinking that this was a money generating exercise and not a “standards” issue at all. Perhaps if the council had prosecuted those that deserved to be penalised, they may well have got the money they so obviously need without trying to penalise the good landlords?
There is a strong feeling of opinion within the landlords and industry peers, that this initiative is going to have to be thought through again in the light of the governments refusal to allow another similar licencing scheme. I have also heard of other challenges to other councils proposing similar arrangements, saying that the schemes are not actually legal. More information when we have it on that situation. So potentially good news for Newcastle landlords and we will continue to update you as we receive more information.
If you would like to discuss your rental, or property sales needs, both buying and selling, please feel free to contact me at my Durham Office on 0191 212 6970. Perhaps we can advise and help you.