Regulations
Expected Rule Changes
The government has reinforced its commitment:
To establish a National register for landlords and tougher regulation for letting agents.
To launch a new website that allows tenants to post their views on landlords and their properties.
To launch a housing hotline that offers free help and advice for private tenants.
Written tenancy agreement will become a legal requirement and the limit for Assured Shorthold Tenancies increased from £25,000 to £100,000 a year. Visit www.communities.gov.uk
House In Multiple Occupation
With effect from 6th April 2010 it became law for landlords to apply for planning permission when looking to establish an HMO by changing a property’s use, such as converting a family home.
Landlords now need to apply for planning permission if there are three unrelated people living in a property; the previous number was six. The changes are not retrospective and will only apply to houses and flats previously occupied by a family, two sharers or a single person.
With effect from 6th April 2006 two key elements of the Housing Act came into force, the first is licensing of Houses in Multiple Occupation (HMO)
HMO will be subject to mandatory licensing if they have
Three stories or more.
Five or more tenants who make up two or more households
One or more shared basic amenity.
Applicants for licences Must be made by 3 July 2006, after this
date enforcement action can be taken if a licence has not been applied
for or obtained, or a temporary exemption notice obtained.
 Each
HMO let by a landlord will require a separate five (5) year licence
and to qualify the landlord or Agent should be able to prove that
they are fit and proper to hold a licence.
Non Compliance could leave property owners subject
to fines of up to £20,000 and rent repayment orders.
Administration of HMO licensing system will be
done by Local Housing Authorities and each local authority will
set its own fee level for licensing application.
In addition to mandatory licensing LHAs can also
introduce additional and/or selective licensing requirements and
are intended to address the adverse impact that poor management
and anti-social behaviour, by a few tenants, can have on other tenants.
What to do now
Landlord and Agents should contact there LHAs now to establish which
property will be eligible for licences, and to start assessing their
portfolios to decide whether they need to make any improvements
or changes the tenancy agreements.
For more information contact: www.propertylicence.gov.uk
Local Housing Allowance
If you let to tenants receiving housing benefit, from 7th April 2008 the housing benefit scheme will be replaced by the LHA. The Local housing benefit will be paid to the tenant who will then be responsible for paying the rent directly to the landlord. This arrangement will not affect current tenants who are already claiming housing benefit before the commencement in April 2008, as landlords will continue to have the benefit paid direct to them for as long as the tenant continues to claim housing benefit at that address. For more info go to www.dwp.gov.uk/housingbenefit/lha
Housing Health and Safety Rating System (HHSRS)
Secondly, the Housing Health and Safety Rating System (HHSRS)
applies to both rental and owner occupied housing and replaces the
existing housing fitness standards set out in the 1985 Housing Act.
HHSRS is a risk-based system designed to assess the health impact
a property has on its occupants. Under the system the local authority
assesses 29 broad categories of hazards and provide a rating for
each, based on the risk to the actual, or potential, occupant of
the property.
For properties failing the assessment the local authority may:
Serve an improvement notice, make a prohibition order, serve a hazard
awareness notice, make a demolition order or declare a clearance
area.
Tenancy Deposit Scheme
Tenancy Deposit Scheme (TDS) or Tenancy Deposit Protection (TDP)
has been designed to protect tenants who have had difficulty recovering
their deposits and to help resolve disputes between landlords and
tenants.
The scheme was originally planned for implementation in October
2006. However, the government intends to introduce this for all
deposit taken on assured short-hold tenancies (AST) in England and
Wales after 5 April 2007 and landlord taking a deposit will be required
to join a government sponsored tenancy deposit protection scheme.
There are two type of schemes (1) custodial where the landlord hands
over the deposit money to the scheme operator and (2) an insurance
based scheme which allows the landlord or his agent to retain the
deposit money. There are severe penalties if landlords
do not comply.
In summary, it relates to AST
agreements taken out with a tenant after 5th April 2007( an existing
tenant taking out a new AST will fall into this category).
It does not apply to AST existing before this date nor rental agreement
over £25,000/year.
Failure to register the tenant's deposit will weaken the landlord's position which may make the landlord unable to regain possession of the property, or a court may order the landlord to pay the tenant an amount equivalent to three (3) times the deposit. amount.
Landlords can still keep deposits after this date But must take out insurance to protect the deposit and the tenants must be
given details. Of course, if there is no deposit there is no need
for TDP. However, it would be prudent to secure a good guarantee
to cover what the deposit would have in the first place. To obtain
further assistance with TDP
Landlords must provide EPC for new tenants
Landlords have been reminded that the deadline for the use of energy performance certificates (EPCs) has passed, it is now law.
The National Approved Letting Scheme (NALS) issued a warning to landlords that the certificates will be required as of 1st October 2008.
By contacting a local Domestic Energy Assessor through local letting agencies and some lending companies, landlords can arrange to have their property assessed to become fully compliant.
All tenants in England and Wales must be presented with a certificate before occupying any property from October 2008. This was devised to cut carbon emissions from UK housing and is mandatory.
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