Another Friday, another Newsround. But first I have to correct something.
Deposit Free options
Unfortunately, some people misinterpreted some wording on that post to mean that you HAVE to offer a no deposit scheme to tenants as well as a traditional deposit. Which is not the case.
I have now amended the post but please note that you only have to offer an alternative option if you are offering a deposit free scheme to tenants. It’s perfectly all right to just offer a traditional deposit. However, if you are offering a no deposit option – you have to let them pay a traditional deposit instead if they want to.
Hopefully, that is now clear. Moving on …
A new housing minister
The Housing Minister, Esther McVey has been sacked – but her boss Robert Jenrick remains. The new housing minister has been announced as Chris Pincher, he is the MP for Tamworth since 2010 and was previously Minister of State for Europe and the Americas.
He is the tenth housing minister in the last ten years and the fourth in the last three years.
Housing is obviously not that high on the cabinet agenda as Pincher will not be receiving the same cabinet privileges as his predecessor, as the Housing Minister post has been taken off the Cabinet attendee list.
Heigh-ho. Some reactions to the change can be seen here.
Year-long tenancies on their way in Wales
It looks like Shelter and Generation Rent are going to have their way in Wales as an amendment to the Renting Homes (Wales) Act looks set to increase the minimum notice periods for section 21 notices to six months.
Bearing in mind that the new act also prohibits serving a section 21 (or rather a no-fault notice as I don’t think the relevant section in the Welsh act is actually 21) during the first six months of a tenancy, this will effectively mean that landlords will be unable to recover possession under no-fault grounds until the tenancy is at least 12 months old.
Julie James, the Welsh Housing Minister said:
This will provide valuable time for individuals and families faced with possession under section 173, and the organisations and agencies that support them, to find a new home that is right for them and make all necessary arrangements for a smooth transition to their new home.
I believe the Renting Homes (Wales) Act, as amended, will provide a sound basis for renting in Wales: balancing the needs and rights of both tenants and landlords and helping ensure our PRS is a well-managed option for households.
However, landlords are incensed by this change. Section 21 is mostly used in situations where the tenant is in arrears of rent or making neighbours lives a misery due to their anti-social behaviour, as the alternative ‘section 8’ procedure is considered unfit for purpose.
Douglas Haig, RLA vice chair and director for Wales said:
It is absolutely essential that landlords with a legitimate reason to repossess their property are able to do so. If they do not many could opt to leave the market altogether – leaving renters with fewer options and potentially pushing rents up.
The government says that those with grounds to repossess can still give the shorter notice period using Section 8. However, RLA research shows 83% of landlords who used Section 21 had done so because of rent arrears alone. Over half had experienced anti-social tenants.
This proves that despite having grounds to evict landlords are currently five times more likely to use the ‘no fault’ Section 21 notice, due to the lengthy court waiting times and expense associated with Section 8.
Despite this, proposals do not include any plans to reform the grounds process, something we believe is vital before any change of this kind is made, to avoid a devastating cut to the supply of homes to rent in Wales at a time when demand continues to grow.
We will have to see.
Delays in the Courts
If landlords are unable to use the no-fault procedure, they are left with the procedure known as ‘section 8’ where they have to give a reason.
A recent report from the RLA Pearl research arm indicates that landlords don’t so much have a problem with the issue of having to give a reason, it is the length of time it takes to get possession which is the problem.
The report shows that despite the fact that the rules and government guidance indicate that claims should take in the region of 10 weeks to complete, The actual figures are far higher.
The ten-week ‘benchmark’ period is on the following basis:
- Court hearing date: 4 weeks
- Possession order: 2 weeks
- Bailiff notice: 2 weeks
- Service and processing of documents time: 2 weeks
- Total: 10 weeks
The actual time varies across the country but recent figures are in the region of 22.6 and 16.6 weeks.
The report concludes:
Both the mean and median waiting times from repossession claim to bailiff enforcement have shown no movement over the last ten years.
The target waiting time of 10 weeks has not been attained, in fact the shortest average waiting time of the last ten years is still over a month longer than this. Not one region achieved this 10-week benchmark for even a single quarter in this study period.
Regionally, the same pattern emerges – improvements in waiting times occur sporadically with no sustained improvement.
With landlords no longer able to use Section 21, the grounds-based court process requires significant reform to ensure this process quickens up, as this will be a landlord’s only means of gaining possession of property.
Letting Agent worries
Recent research by Lettings platform Goodlord indicates that many letting agents are concerned about their future. Issues of particular concern are
- The Tenant Fees ban
- The forthcoming new Electricity regulations
- The impact of mandatory qualifications (if Lord Bests ROPA recommendations are taken up)
- Suppliers’ prices, and
- Falling rental volumes as landlords exit the market
Tom Mundy, chief operating officer at Goodlord, said:
With revenues for 85% of agents hit by the Tenant Fees Act, it’s no surprise that many are expressing concerns for the future.
However, it appears, anecdotally, as if not a few letting agents are less than satisfactory so let us hope that it is those firms who close.
For example, recent reports include this agent banned after using £28,000 of client money in failed attempt to keep business going, and the agent in this report who is still trading despite several complaints to the Ombudsman and Trading standards on issues such as failure to protect a deposit and delays in paying rent over to landlords.
Not to mention the agents in this report fined a total of some £110,000 for letting out an unlicensed property with numerous safety issues.
- Merger between two biggest landlord bodies running weeks behind schedule
- Mystery continues to surround the government’s flagship rogue landlord database
- MPs urge government to fix all buildings with dangerous cladding
Newsround will be back next week.