Sometimes it looks and feels like the Government really does not know what to make of private sector landlords – are they the rogue, slum landlords who put their tenants’ lives at risk, or are they the vital national resource who provide good quality homes for millions of people?
The Government indirectly pays private landlords billions of pounds each year in rent (for those in receipt of welfare benefits) and in return it has been clawing back much of this through increased stamp duty, changes in the tax system and approving more licensing schemes.
Now in the space of just a few days in early November, the Government demonstrated its intention to squeeze the sector a bit harder.
Firstly it announced it is requiring landlords of the coldest rental homes to install energy efficiency measures at a potential cost of £3,500 per property. Just a few days later it said it wanted local councils to crackdown further on rogue landlords. And then it published plans to set up a specialist Housing Court to resolve disputes between tenants and landlords.
All in all this looked and felt like a significant package of measures to safeguard the rights of private tenants, but often at the expense of their landlords.
These new measures will help improve the coldest homes, protecting tenants whilst also saving them money
High levels of satisfaction
You would be forgiven for thinking private tenants are a very dis-satisfied bunch, but the most recent and widely used survey of them shows that 84 per cent are satisfied with their accommodation. That surprisingly high figure does however, drop to 68 per cent when the same tenants are asked how satisfied they are with their current form of tenure – but is that a comment on their landlords, or on the state of the housing market and the law surrounding the security and length of tenancies?
Since April this year, landlords letting out some of the coldest privately rented homes have been required to improve these properties to an Energy Rating of E, but they were helped to cover the costs of energy efficiency works. On Guy Fawkes Day, the Government announced that from 2019 landlords will have to pay more of the upfront costs for installing cavity wall, underfloor and roof insulation, fitting draught excluders and upgrading their windows.
From 2019 properties with an Energy Performance Certificate (EPC) rating of F or G (the two lowest energy efficiency ratings) must be made warmer by their landlords, before they can be put on the rental market for new tenancies.
The Government estimates this will cost £1,200 on average and will affect 290,000 properties, representing around six per cent of the overall domestic market. Ministers say the cost to landlords will be more than offset by the increase in property values. The changes are expected to save tenants an average of £180 a year per household in heating costs, while also reducing carbon emissions.
However, David Cox, Chief Executive of ARLA Propertymark was not impressed by the new measurers. He said: “This announcement that landlords will need to pay the first £3,500 to make improvements to their properties to ensure they are minimum EPC rated E or higher, is bad news for the private rented sector.
“Over the last few years, the financial burdens faced by landlords have increased time after time, which is pushing rent costs up and driving buy-to-let investors out of the market. Under the Energy Act 2011, the Government pledged to avoid any ‘upfront costs’ for landlords – a principle which has been wholly disregarded by setting the cap as high as £3,500.”
His complaints failed to move the Housing Minister Heather Wheeler, who said: “Excess cold is by far the largest preventable cause of death in the private rented sector. It is estimated by the World Health Organisation that 30 per cent of avoidable winter deaths are due to people living in cold homes. These can be prevented if people were kept warm during the winter months.
I strongly welcome these new measures, which will help improve the coldest homes, protecting tenants whilst also saving them money.”
Part of a campaign
It is the case that most landlords will be unaffected by these particular changes as their properties are already compliant, but they add to a climate where a growing number of private landlords feel they are being required to pick up the tab for the Government’s failures to fix the housing market.
As part of a campaign to drive up standards in the private rented sector, the Government recently announced reviews of health and safety standards and for carbon monoxide alarm requirements in privately let homes.
It has also allocated £2million for local councils to bid for funding to support a range of projects that “councils have said will help them to ramp up action against criminal landlords – for example, to build relationships with external organisations such as the emergency services, legal services and local housing advocates”. Councils may also decide to use the funds to support tenants to take action against poor standards through rent repayment orders.
And now James Brokenshire has unveiled plans to establish Housing Courts to provide a quicker legal resolution to disputes between tenants and landlords. This should cut down on the number of tenants who are evicted at short notice or remain stuck in poor accommodation, but will it guarantee landlords are paid the rent they are owed and protect them from bad tenants who damage their property and cause a nuisance to their neighbours?
Only time will tell.