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The Blog

Possible impact of Brexit on the private rented sector

The upcoming referendum on Britain’s membership of the European Union has ignited a fierce debate.
Unfortunately so far both sides have been subjecting us to spin, scaremongering and name calling but sadly few facts or argumented points.

Fortunately, a wealth of resources is available to help shed light on possible consequences of leaving the EU on the private rented sector.

The PRS is a bit of a niche so I looked at the likely impact of a Brexit on the main areas affecting private landlords.
In my opinion, these are: the economy in general, population growth, the property market, finance, taxation, and relevant laws and regulations.

Right to Rent rolls out today in England

The ‘Right to Rent’ regulations stemming from the Immigration Act 2014 become effective today in England: Landlords are now required to carry out ‘Right to Rent’ checks for all new tenancies.

Housing Bill: Recovering abandoned premises

The Housing and Planning Bill, which second reading in Parliament took place this week, contains provisions for a new procedure for recovering abandoned premises in England.

Under the new procedure, a private landlord will be able to bring an assured shorthold tenancy to an end without a court order by following a strict procedure, if the premises have been abandoned.

Retaliatory evictions: new rules and adequate response

New provisions of the Deregulation Act 2015 aim at preventing so-called retaliatory evictions by making section 21 notices invalid in case of disrepair.

Landlords may be prevented from serving a section 21 notice following a tenant’s complaint and this restriction will apply for 6 months after a local authority issues an improvement notice.

Retaliatory eviction bombshell

Under the new anti-retaliatory eviction legislation, tenants could be safe from eviction for 6 months even if they did not report disrepair to their landlord.

A council’s improvement notice will always prevent a valid section 21 from being given.

Section 21 prescribed form amended

The new prescribed form for section 21 notice has just already be amended, even before it becomes effective tomorrow.

There were quite a few issues with that form (discussed here) and this ‘new’ new form fixes some of them, and creates more.

Requirement to install smoke and CO alarms

From the 1st October, landlords will be required to install smoke and CO alarms in all occupied properties, and to ensure that these alarms are in proper working order on the day new tenants move in.

New section 21 requirement: prescribed information booklet

From the 1st October, the use of section 21 notices for new assured shorthold tenancies in England will be subject to additional requirements (following new section 21A added by the Deregulation Act).

Landlords will be required to have given the tenant new prescribed information in order to be able to serve a valid notice.

The new prescribed information, not related to the prescribed information on tenancy deposits’ protection, is a booklet entitled “How to rent: the checklist for renting in England” available here.

The Deregulation Act could cost you rent

From October, if you seek possession under section 21 and your tenant no longer occupies the property, you should be careful.

A new provision under the Deregulation Act 2015 entitles tenants to a refund of rent following service of a section 21 notice.
Under this new provision, landlords could lose up to one period worth of rent while the tenancy would still exist (and thus while they couldn’t re-let the property).

To renew or not to renew

The bulk of the changes introduced under the Deregulation Act 2015, and all the negative ones for landlord, are expected to become effective later this year, on the 1st October.

However, landlords can avoid them until 2018.

Deregulation Act: Why tenancy deposits still need 're-protecting'

Following my previous post on the topic and further discussion with the excellent Nearly Legal on his blog (and by that I mean I somewhat “hijacked” his post…) I have realised that I have not done a very good job at putting my point across.

Therefore, here’s take two.

My claim is that the Deregulation Act does not in fact remove the requirement to ‘re-protect’ tenancy deposits.

Section 21 notice and breach of deposit protection

The common advice when a tenancy deposit wasn’t protected or was protected late is that it must be returned before a valid section 21 notice may be served.

Fortunately for landlords, this is not the whole story.

Deregulation Act and tenancy deposits: Is it really so simple now?

Recent cases like Superstrike v. Rodrigues or Spencer v. Taylor have demonstrated that statutes must be read carefully for what they actually state, not what they ought to state.

With that in mind, I took a close look at section 32 of the Deregulation Act, which creates a new section 215B in the Housing Act 2004 intended at removing the effects of the Superstrike case, namely the requirements to give the Prescribed Information to the tenant again, and to comply with the deposit scheme’s initial requirements, every time a replacement tenancy is created (including a statutory periodic AST).

Section 215B apparently does not remove all of these requirements.

Bye bye Superstrike

The Deregulation Act 2015 received Royal Assent on 26 March, with amendments related to tenancy deposits becoming effective immediately.
This means that the consequences of the notorious Superstrike v. Rodrigues case are no more, and so is the worst of Charalambous v. Ng.