Managing the property during the tenancy
Key changes to property management during a tenancy: Awaab’s Law, rent increases, and penalties
At the moment, when problems relating to the condition of a rented property are reported to the landlord, they are simply required to fix them within a ‘reasonable’ timeframe.
Awaab’s Law, named after a young boy who died in a social-rented home as a result of health problems brought on by damp and mould, is currently applied to the social rented sector. The Bill will extend it to private lets, and it will impose strict new timelines for landlords to investigate and fix reported serious health hazards. Find out more in our blog, ‘What is Awaab’s Law?’.
The way landlords can legally increase rents will change. Currently, rent rises can be written into rental agreements and rents can be increased if tenants agree. Rents can also be legally raised by issuing a Section 13 notice not more than once in a 12-month period, and the increase must be “fair and realistic”.
The Bill proposes that increases can no longer be written into contracts and landlords will only be able to legally increase rents once a year, using a Section 13 notice. Increases must align with current market rates.
Tenants’ rights to challenge rent increases are also being strengthened. Currently, they can take the matter to the First-Tier Tribunal, but they could end up paying a higher rent if the Tribunal decides that’s a fair market amount. Under the Bill, the Tribunal would not be allowed to raise the rent beyond the amount the landlord was proposing, meaning there would be no financial risk for tenants in making a challenge.
Labour has also confirmed that it does not plan to introduce rent caps, as has happened in Scotland.
Find out more in our blog, ‘What’s happening with rent rises and bidding wars?’
Local councils can currently issue civil penalties of up to £30,000 to landlords who breach certain lettings regulations.
Under the Bill:
The maximum penalty for serious and persistent non-compliance will be increased from £30,000 to £40,000.
Landlords who fail to keep their property free from serious hazards can be fined up to £7,000 by the local council – currently this is for the courts to decide.
Local councils will also be able to issue civil penalties against landlords who evict tenants illegally – penalties for this can currently only be issued by the courts.
Find out more in our blog, ‘What are the new powers being given to local councils?’.
In the original draft of the Bill, it was proposed that Rent Repayment Orders (RROs) should be extended to superior landlords and the maximum penalty increased from 12 to 24 months’ rent. At the third reading in the Commons, an amendment was accepted that RROs could be made against any landlord in the chain, irrespective of which landlord receives the rent.
With over 400 separate rules and regulations, and potentially huge penalties for breaking the law, you have to be able to manage your rental professionally if you want to make and hold on to good returns. Read our ‘Ultimate landlord’s guide to rental property management’ for detailed guidance and advice.
