Another white paper – levelling up

What does it mean for landlords?

The Government have decided again to use the levelling up white paper to add even more red tape onto landlords.

However, the Government already have current legalisation that is stuck in parliament such as the renters reform bill. This particular reform package for the private sector is set to include abolishing the section 21 notice – the end of tenancy notice. And, an introduction of lifetime deposits.

The legalisation has still not yet come through but there are various previsions within the renters reform such as;

1. Abolishing the section 21 – The so called no fault evictions. Improving security for tenants in the private sector.
2. Strengthening the repossession grounds for landlords under section 8 if they have a valid cause.
3. Outlining proposals for a new life time tenancy model that is the burden on tenants when moving from one tenancy to the next.
4. Bringing reforms forward to drive improvements in rented accommodation, including right of redress and ensuring the world targeted, affective enforcement drives out criminal landlords.
5. Considering further reforms of the private sector enforcement so it is well targeted. This will tackle bad landlords.
6. Exploring improvement and possible efficiencies to possession process in the courts.

The Government have also outlined this year and this will shortly become law that they now require landlords to provide a CO2 detector in all properties. Including where there is gas central heating.

What does the white paper entail for landlords?

The white paper outlines various areas that the Government want to improve such as;

1. Poor housing quality.
2. Over crowding.
3. Alliance on temporary accommodation for vulnerable families.

Solution.

The Government will first build more housing in England that is generally affordable social housing and second they will launch a new drive on housing quality to ensure the homes are fit for purpose.

Further requirements will be to;

1. Improve the quality and regulation of house.
2. Give residents rights that they can hold their landlords to account.
3. Landlords have to then take quick and effective action to put things right.
4. A potential national landlord register.
5. Ending all section 21 (no fault eviction).
6. Renters to have a secure path to ownership.
7. Potential rent controls – This has not been laid out within the white paper but more calls are coming from MP’s for it. Even though there are provisions already.
8. New affordable housing and re-generations in certain areas with a drive to building affordable homes mainly in the North of the country.
9. Targeting brownfield sites for additional housing.
10. Improvements to the planning system to add additional homes for social housing.
11. Getting rid of people on the streets and provide better housing for homelessness and longer term accommodation.
12. Provide much better quality housing for tenants.
13. Potential reintroduction of the Government selling packs that were previously ditched by the Government.
14. Reintroducing compulsory purchase of empty properties that have been empty for more than 18 months – 2 years.

How will this affect landlords?

There are various regulations that are already in place and the Government are now looking to either improve these or enforce them. One of the big areas that will affect landlords will be the no fault section 21 evictions. This section 21 notice will in effect be completely scrapped and landlords will have to justify getting their properties. There are no details of the actual proposal so far and these no fault evictions were already mentioned within the renter reform bill.

There will be a nation landlord register and any action taken against the landlord will show on the register. This will improve the home standards so the Government feel in respect of naming and shaming landlords.

The Government are potentially going to bring forward the EPC rules regarding properties to bring the standard of rating up to a C. Rather than the current D and E rating. There will be a 2.2 billion fund through the home upgrade grant and boiler upgrade scheme. This also includes moving boilers from gas to electricity.

The Government in our opinion want to turn the housing market for landlord lead to tenant lead. How this will affect landlords in future will only become apparent when the detail the Government have yet to supply is given through the white paper. We will keep you advised throughout the whole process. But, as set out above there are various areas that they are already starting to target. All of the proposals at this moment in time are all for the future and there is nothing apart from the installation of a CO2 detector that landlords need to be concerned about now.

How will this affect the planning system?

There has been strong commitments made to overhaul the planning system but unfortunately within the paper there was a startling absence of detail. A policy vacuum continues to create uncertainty, impacting the progress of local plans and delivering new homes in particular.

The development industry has long been pushing for principal of development to be established through the local plan process. This will involve each local planning authority creating growth areas in their local plans, within which any site would automatically be granted outline planning permission for principal development following the plans.

Unfortunately, the Government has apparently told MP’s that they will not be bringing forward the planning bill. They have decided not to produce with this major separate piece of planning legalisation to put reforms into the law. Instead more limited change to planning rules will be incorporated as part of the levelling up and regeneration bill.

How this will affect landlord who are looking to do development on their properties no-one will know until such time as the bill has been fully put into place.

What is clear though, about white paper levelling up, is that housing will dominate the agenda. 120 Million for Mayoral combined authorise will allow for a delivery of 7800 homes in the North and Midlands. These will mainly be on brandfield lands. In additional, 12 billion has been ring fenced for affordable housing and an additional 2.6 billion from the shared property prosperity fund, which aims to decrease prosperity between communities.

There will also be extensive reforms to social housing, presumably through the 11.5 billion affordable housing programme, with social housing regulation bill being introduced as part of the white paper levelling up agenda.

Looking to the future.

The Government which has been criticized until now for not defining what levelling up actually means, has released a comprehensive programme for change. The scope for improvement for both housing and communities is more widely accepted. Whilst many are not quite sure what levelling up entails in detail as it has not yet been outlined by the Government. Many people believe that whilst the money has been promised isn’t actually news. Only time will tell.

Requirements

There are further requirements that landlords will need to deal with in future and we will keep you updated.

Do you have a property near the University of Brighton or the University of Sussex? Do you have any form of student accommodation? We are in desperate need of more accommodation and we would be more than happy to do a valuation for you. Anything from the Hove seafront to the Moulsecoomb campus that includes some form of student living then we are experts in this. Please therefore do not hesitate to contact us on 01273 724000 or viewings@harringtonslettings.co.uk

We also are in need of residential accommodation. Harringtons have been within the Brighton and Hove for in excess of 29 years and are in need of more accommodation. We have waiting tenants all the times and are recommended on a regular basis. If you have a property that you are considering renting then please don’t hesitate to contact us in this regard.

Do you know what your property is currently worth?

Property prices are forever changing within the market and we can advise you on what your current rental is worth. To include what it would be if it were to come on the open market now. Again, please do not hesitate to contact us on 01273 724000 or viewings@harringtonslettings.co.uk

iInsure 365

Have you been introduced to our sister company iInsure 365 who deal with all types of insurance? You wont have to worry about filing out a long lengthy forms to find cheap landlord insurance. With iInsure 365 you can speak to one of the team and they will find you a quote through their panel of provider. They deal with all types of level of cover and have various different insurer who can offer quotes for you. There are legal requirements for landlords and it is important that you have the right insurance company to deal with your insurance cover.

A landlord may have one or more properties in the United Kingdom that they rent out. It is important for landlords to spend time looking for the right insurance. Make sure you find an insurance policy specifically designed for landlords. They can ensure properties from all over the United Kingdom for you.

Landlords often believe that a new home policy will suffice. This is not the case and they will then make a claim which virtually all insurers will turn down. Standard home insurance policy mostly cover homeowners or property owners, not landlords. If you stick with your normal house insurance policy you can find yourself with no cover at all.

Landlords building insurance

Landlord building insurance is specifically tailored for landlords and their requirements. iInsure 365 will insure what you need for your policy.

Are you aware of the growing risk of underinsurance?

In the words of the financial conduct authority “there is already an alarming degree of underinsurance”. With both the UK businesses and consumers creating issues throughout each of the property sectors.

It is the responsibility of landlords to ensure they take out sufficient levels for cover for the insured risk of having insurance.

If they fail to take out sufficient level of cover this can have devastating consequences for you. It can result in significant reductions to any insurance pay outs and potentially in the worst case scenario, it may void the policy. Resulting in no pay out at all.

A practical example is as follows;

If the rebuild cost of your premises is £200,000 but the property is only insured for £100,000 then you are underinsured by 50%. Every insurance company will have an average clause in the policy which is standard and therefore it reduces the sum insured by leaving the policy holder with 50% of an insurance pay out of just £50,000.

We understand from iInsure that they recently had one of their clients check their rebuild costs. iInsure have an ability to be able to check a policy for the correct sum insured for only £160.00. Substantially more than what most surveyors charge.

The client was insured for £630,000. Once the report was carried out it stated that it should have been £856,000. There was an underinsurance of £226,000 which would have been taken off any claim.

They can provide you with a RICKS certified up to date revaluation. Ensuring that your property is correctly insured for the right amount. The cost is minimal compared to what the situation would be if you weren’t paid out to the correct amount.