New legislation affecting buy-to-let landlords will soon be in force
There have been several changes in the landlord laws in the last few months, and more coming into force in 2018. Ignorance of them is no defence against tougher penalties and thousands of pounds in fines. In this article, you’ll learn the main changes that have been made and which might affect you as a buy-to-let landlord in the UK.
It’s a crackdown against rogue landlords
As the private rented sector grows, we can expect the government to focus on tackling rogue landlords. Not simply because it’s the right thing to do, but because it’s a vote winner. More happy tenants equal more happy voters.
Specifically, the government has clamped down on those landlords who rent out substandard properties. They are trying to increase standards for tenants and relieve overcrowding. Measures include:
- Minimum size requirements for bedrooms in houses in multiple occupations (HMOs)
- Local authorities have been given extra landlord licensing powers
- A database of rogue landlords is being set up
- The banning of certain people from being landlords
Are you allowed to be a landlord?
The government is encouraging the setting up of rogue landlord registers across the country. Already, 10 boroughs in London have signed up to the scheme, which allows details of poor behaviour by landlords to be kept on a register available to be viewed by the public.
As part of its efforts to weed out the bad, the government has said that several offences would automatically ban a person from being a landlord. These include burglary and stalking, and:
- Illegally evicting or harassing a residential occupier in contravention of the Protection from Eviction Act 1977
- Using violence to secure entry under the Criminal Law Act 1977
- Failure to comply with an Improvement Notice
- Failure to comply with a prohibition order
- Offences about licensing of HMOs
- Offences about licensing of houses under Part 3 of the Housing Act 2004
- Contravention of an overcrowding notice
- Failure to comply with management regulations in respect of HMOs
- Providing false or misleading information
The rogue landlord database in London will detail a landlord’s record, including criminal and civil actions and enforcement notices given by the local authority. The government plans to make a national database of rogue landlords available from April 2018.
New rules benefit all
We believe that these new rules haven’t come soon enough. There are too many rogue landlords who give the sector a bad name. The actions of a few embarrass the many. Local authorities can now also levy fines of up to £30,000 on dishonest landlords. It should make it easier to ensure that landlords of buy-to-let properties are held responsible for unkempt properties that degrade local communities.
Of course, not all problems are the fault of a landlord. Rogue tenants also exist, which is why it becomes even more important to ensure that tenant applicants are vetted effectively, and that tenancy agreement are up to date and comprehensive.
Are your HMO rooms large enough?
Over the Christmas period, the government announced new requirements on HMOs designed to reduce overcrowding. Although not yet law, landlords of HMOs should make sure they prepare for these new guidelines, which look set to become law in the spring. At this time, your landlord HMO licence will need to stipulate how many people can sleep in which room. It will depend upon room size as follows:
- Rooms for one adult must be a minimum of 6.51 square metres
- Rooms for two adults must be a minimum of 10.22 square metres
- Bedrooms for children aged 10 and younger must be no smaller than 4.64 square metres
Also, the HMO licence must stipulate how many people is the maximum that can live on the property. This number must not be greater than the total number of people across the bedrooms provided.
When it announced the measures, the Department for Communities and Local Government (DCLG) said:
“The increased demand for HMOs has been exploited by opportunist rogue landlords, who feel the business risks for poorly managing their accommodation are outweighed by the financial rewards. Typical poor practices include overcrowding, poor management of tenant behaviour, failure to meet the required health and safety standards, housing of illegal migrants and intimidation of tenants when legitimate complaints are made.
“Tenants are sometimes exploited and local communities blighted through, for example, rubbish not being properly stored, excessive noise or anti-social behaviour. Although only a minority of landlords the impacts of their practices are disproportionate, putting safety and welfare of tenants at risk and adversely affecting local communities. They cause much reputational harm to the HMO market and it is often pot luck whether a vulnerable tenant ends up renting from a rogue or a good landlord.”
Make sure your property passes energy efficiency regulations
Also coming into force in 2018 are the Minimum Energy Efficiency Standards (MEES). If your property doesn’t comply with these regulations, you could be fined a minimum of £5,000. Your property must have a MEES rating of E or above from April 2018. Older properties are most at risk, but we’d recommend that you ensure your property either comply with the new law or is exempt.
There’s a lot happening this year – don’t get caught out. To make sure your property is managed effectively and remains on the right side of buy-to-let laws, contact one of the Ezytrac team today on +44 01522 503 717.