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Levelling up? June 22 Update
22 June 2022
Proposed Renters Reform Bill – Levelling the playing field?
We are only half way through the year and already 2022 will certainly be remembered as a year that has affected us all.
The cost of living is spiralling ever upwards with no signs of stopping. At the time of writing, interest rates have just seen an increase of 0.25% to 1.25%, the highest in 13 years and, with the Consumer Price Index (CPI) at 9.1% and the Retail Price Index (RPI) at 11.7%, one can say with a degree of certainty that inflation is going to continue for the time being.
The Department for Levelling Up, Housing and Communities (DLUHC) has just published the long overdue White Paper, now called 'A Fairer Private Rented Sector' aimed at expanding Tenant's rights within the Private sector. This has gone further than expected and is being dubbed the biggest shake up within the industry in 30 years, redressing the balance between Landlords and the 4.4 million Tenants in the Private Rented Sector (PRS).
There are five main changes to be noted and these measures include:
1. Removal of and abolishment of the Section 21. This section as it currently stands, enables Landlord's to serve notice on their current Tenant to vacate the property without any explanation. The DLUHC wishes to amend this so Landlord's may only give notice with a valid reason, mainly:
i. Should they wish to move into the property themselves.
ii. Should they wish to sell the property.
2. Arbitrary rent review increases. This will prevent Landlords and their Agents introducing unjustified rent increases upon their Tenants.
3. Blanket bans on renting to benefit recipients or families with children.
4. No blanket bans on renting to Tenants with pets. Tenants will be given the right to request a pet in their new homes which all Landlords must consider and cannot unreasonably refuse.
5. Private Renters' Ombudsman. This is a positive for Landlord's as this scheme shall enable disputes to be settled easily, quickly and at low cost without having to go to court to help Landlord's remove anti-social Tenants from their properties.
Many would argue these new proposals are needed, however they have to be carefully balanced to ensure that any short-term ‘quick-fix' does not affect and limit market growth in the long-term. Bricks and mortar, especially within Prime Central London, have long been considered as a good investment, with tangible assets seen as the better choice over stocks and shares, however a decade of tax and regulatory burden has resulted in many property owners withdrawing from this area, placing an enormous strain on an already oversubscribed market.
For any more information please do call us on 0207 589 3353 or email Clem Byron Evans
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