Welcome to Landlord Law’s weekly Newsround, let’s see what has been in the housing news this week.
Trends predict rent rises following Renters Right Act
New stats out this week predict that now the Renters Right Act is to become law 81% of landlords will be much more selective on prospective tenants and 71% say rent increases are now inevitable to take into account new costs and restrictions that they will incur.
Pegasus, a mortgage specialist, who carried out the research also say that 73% of landlords think that the act will impact negatively on their letting experience and 81% feel that the overall impact on the PRS sector will be negative.
As landlords prepare, they will be a lot more cautious said Mark Long managing director of Pegasus, he also adds
This mismatch between perception and reality underlines how complex PRS reform can be: policies designed to protect tenants could, unintentionally, make it harder for them to find and afford a home.
Credit scoring to now include rent payments
Some good news this week as we read that Experian, a credit rating agency, will now include a tenant’s rent payments into their credit scoring. This could see their scores increase considerably as long as they keep their payments up.
Tenants will need to ‘opt in’ for their rent payments to count against their credit rating. This is in line with mortgage companies that now recognise consistent rent payments in their scoring. This is good news for both renters and landlords as it gives more incentive for tenants to pay their rent on time and every month.
Calls to reform council licensing schemes
In light of the Rachel Reeves debacle last week, a licensing expert is calling for a national scheme for all licenses instead of what we have currently, which is a mismatch, disjointed application processes, vastly different fee structures and varying conditions for each council, and that is also the same for any licensing breaches.
Richard Tacagni, MD of London Property Licensing, said
Perhaps it’s time to replace this complex licensing framework with a simple, consistent and streamlined national licensing scheme that can sit alongside the new landlord database being introduced by the Renters’ Rights Act.
‘Flathuggers’ stall the rental market
New stats out this week by SpareRoom detail that 56% of renters are staying put despite wanting to move, but being unable to afford to, along with a lack of supply of rental property and high competition. The over 40’s are being hit the most with 61% staying put.
With record high rents, tenants are avoiding contact with their landlord or agent for fear of getting a rent rise. They are also declining job offers (19%), which involve a house move in preference to the stability and stress of looking for another rental home.
Mark Hutchinson, director of SpareRoom says of ‘flathuggers’
This affects the market immediately. Longer tenancies, fewer viewings, and competition for limited stock all slow turnover. Agents are managing a quieter cycle while renters settle into longer stays.
Snippets
Regulation blamed for slump in new-build housing supply
New set of forest towns to be built between Oxford and Cambridge
Another council wants a clampdown on small HMOs
One in five social housing tenants is dissatisfied with overall landlord services
Flooded UK coalmines could provide low-carbon cheap heat ‘for generations’
Taxing landlords harder will critically damage growth warns NRLA
See also our Quick News Updates on Landlord Law
Newsround will be back again next week