Recommendations & Conclusions
12 items
1
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
The abolition of fixed-term tenancies, combined with the abolition of section 21, would undoubtedly give tenants greater security of tenure. We understand the argument that fixed-term tenancies should remain available where both parties want them, but in practice, given the current shortage of private rental properties, this would likely result …
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The abolition of fixed-term tenancies, combined with the abolition of section 21, would undoubtedly give tenants greater security of tenure. We understand the argument that fixed-term tenancies should remain available where both parties want them, but in practice, given the current shortage of private rental properties, this would likely result in tenants having fixed terms forced on them. A reasonable balance needs to be struck between security of tenure for tenants and a degree of certainty for landlords. We therefore recommend that tenants be unable to give two months’ notice to leave until they have been in a property for at least four months. This will give landlords the legal certainty of at least six months’ rent at the start of a tenancy.
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Government response AI summary
The government states tenants will be able to give notice at any point during the tenancy to avoid replication of fixed terms, and has increased the notice period to two months to ensure landlords have sufficient guarantee of rent.
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Ministry of Housing, Communities and Local Government
5
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
Before section 21 can be repealed, landlords must have confidence in their ability to regain possession under section 8, especially in the case of rent arrears and antisocial behaviour. The biggest obstacle to this is the capacity of the courts. We continue to maintain that the best way to improve …
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Before section 21 can be repealed, landlords must have confidence in their ability to regain possession under section 8, especially in the case of rent arrears and antisocial behaviour. The biggest obstacle to this is the capacity of the courts. We continue to maintain that the best way to improve the housing court system is to establish a specialist housing court, and we do not think the Government has given a satisfactory reason for rejecting this proposal. We are concerned that the Government does not fully appreciate the extent to which an unreformed courts system could undermine its tenancy reforms.
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Government response AI summary
The government recognises the importance of making the court process smooth and efficient and is working with the Ministry of Justice and HM Courts and Tribunal Service to drive forward improvements to the court possession process, including digitising the process, exploring prioritisation of certain cases, …
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Ministry of Housing, Communities and Local Government
12
Recommendation
Fifth Report - Reforming the Private Re…
Acknowledged
If the decent homes standard is to improve standards in the private rented sector, local authorities will have to enforce it vigorously, but at the moment levels of housing enforcement activity vary hugely between local authorities. We accept that much enforcement activity is, and should remain, informal, especially, at least …
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If the decent homes standard is to improve standards in the private rented sector, local authorities will have to enforce it vigorously, but at the moment levels of housing enforcement activity vary hugely between local authorities. We accept that much enforcement activity is, and should remain, informal, especially, at least initially, where landlords are non-compliant out of ignorance, but if the proposals are to deter the very worst landlords, enforcement rates will have to improve significantly across the vast majority of local authorities. For this reason, we welcome the proposals to improve enforcement, particularly the property portal, which could be revolutionary, provided it is designed and implemented properly and holds the right information. To this end, the Government should include the following in the information landlords are required to enter on the property portal: all gas and electrical safety certificates and reports; any other reports generated by tradespeople; energy performance data; and details of ombudsman membership and membership of a deposit protection scheme. Furthermore, the Government should take action now to digitise the certificates and other reports that are to be uploaded to the portal, so that rather than being a mere repository of information that has to be trawled through, a coding system can be implemented to enable the portal to verify that documentation is in date and that there are no issues that need addressing. To deter landlords from entering false or misleading information, the 60 Reforming the Private Rented Sector Government should also introduce financial penalties for such offences. This would be consistent with its proposal for deterring landlords from self-declaring inaccurate information regarding compliance with the decent homes standard. Finally, we urge the Government to incorporate the functions of the database of rogue landlords and property agents into the portal as soon as possible.
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Government response AI summary
The government agrees a strong enforcement regime is vital and is committed to ensuring local councils have the powers and resources they need to tackle criminal landlords. The Levelling Up, Housing and Regeneration Bill includes measures to set minimum standards for enforcement, which they will …
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Ministry of Housing, Communities and Local Government
13
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
We are conscious, however, that the financial position of local authorities remains extremely precarious, that this partly explains the lack of enforcement activity, and that some of these proposals will place an additional burden on local authorities’ resources. The Government is yet to carry out the new burdens assessment it …
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We are conscious, however, that the financial position of local authorities remains extremely precarious, that this partly explains the lack of enforcement activity, and that some of these proposals will place an additional burden on local authorities’ resources. The Government is yet to carry out the new burdens assessment it promised in the White Paper, but we are aware that many of the proposals are intended to be self-financing, either through fines on non-compliant landlords or fees paid by all landlords (for the ombudsman and the property portal). It appears, then, that the biggest new burden on local authorities will be enforcement of the DHS, particularly the inspection of properties, at least during the initial phase of the new regime, before it has had time to become self-financing.
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Government response AI summary
The government agrees a strong enforcement regime is vital and is committed to ensuring local councils have the powers and resources needed and is addressing inconsistencies in enforcement activity.
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Ministry of Housing, Communities and Local Government
14
Recommendation
Fifth Report - Reforming the Private Re…
Acknowledged
In the current economic climate, we accept that the Government is unlikely to provide significant additional long-term funding for local authorities, but it must consult them, if it has not already done so, on how much short-term funding they will need to get the regime up and running. In particular, …
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In the current economic climate, we accept that the Government is unlikely to provide significant additional long-term funding for local authorities, but it must consult them, if it has not already done so, on how much short-term funding they will need to get the regime up and running. In particular, local and central government should agree what staffing levels will be required and then fund their recruitment. The Government should also assess the availability of environmental health officers and other enforcement staff and work with the sector to ensure that enough places on training courses are available. Local authorities will need many more enforcement officers if the proposals are to make a meaningful difference.
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Government response AI summary
The government agrees a strong enforcement regime is vital and is committed to ensuring local councils have the powers and resources needed and is addressing inconsistencies in enforcement activity.
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Ministry of Housing, Communities and Local Government
15
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
The new regulatory regime will only become self-financing if local authorities can recoup the cost of enforcement from non-compliant landlords, but we have heard from local government representatives that the civil penalties regime, which in theory should fund enforcement activity, is currently not working for local authorities, and this is …
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The new regulatory regime will only become self-financing if local authorities can recoup the cost of enforcement from non-compliant landlords, but we have heard from local government representatives that the civil penalties regime, which in theory should fund enforcement activity, is currently not working for local authorities, and this is evident from the data on their use. We are also concerned by the apparent difficulty some local authorities experience when seeking to prosecute landlords for housing offences, including the claim that landlords can avoid prosecution by simply transferring ownership.
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Government response AI summary
The government agrees a strong enforcement regime is vital and is committed to ensuring local councils have the powers and resources needed and is addressing inconsistencies in enforcement activity.
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Ministry of Housing, Communities and Local Government
16
Recommendation
Fifth Report - Reforming the Private Re…
Acknowledged
If it is not already doing so, the Government should consult local authorities about what amendments are needed to the civil penalties regime and include any necessary legislative changes in the proposed renters reform Bill. In particular, we recommend that non-payment of a civil penalty be made a criminal offence …
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If it is not already doing so, the Government should consult local authorities about what amendments are needed to the civil penalties regime and include any necessary legislative changes in the proposed renters reform Bill. In particular, we recommend that non-payment of a civil penalty be made a criminal offence and that local authorities be given the power to register an unpaid penalty as a legal charge on the property. We also again recommend that the Government remove the requirement on local authorities to obtain the permission of the Secretary of State to introduce a selective licensing regime covering more than 20% of private rented homes in their areas. It should be for local government, unencumbered by too much central control, to decide the best way to enforce housing standards. Finally, on prosecutions, we repeat the recommendation of our predecessor Committee in its 2018 report, Private rented sector, that courts require offenders to pay costs to local authorities that reflect the actual cost of the enforcement action. We also ask the Government to clarify whether Reforming the Private Rented Sector 61 landlords are able to avoid prosecution for housing offences by transferring ownership of the property before the court hearing. If this is the case, we recommend it consult on what changes are necessary to prevent this from happening. (Paragraph 93) Affordability
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Government response AI summary
The government agrees a strong enforcement regime is vital and is committed to ensuring local councils have the powers and resources they need to tackle criminal landlords. The Levelling Up, Housing and Regeneration Bill includes measures to set minimum standards for enforcement, which they will …
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Ministry of Housing, Communities and Local Government
17
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
The data suggests that the reduction in the size of the PRS, which the Minister partly attributed to the covid pandemic, began three years before the pandemic, in 2016–17. For this reason, we see little reason to believe the decline is short term, although the pandemic may have exacerbated the …
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The data suggests that the reduction in the size of the PRS, which the Minister partly attributed to the covid pandemic, began three years before the pandemic, in 2016–17. For this reason, we see little reason to believe the decline is short term, although the pandemic may have exacerbated the trend. The only certainty is that the Government does not know what is happening in the PRS and has not said what role it wants it to play in the wider housing mix. In particular, it is difficult not to suspect, given the changes to how the buy-to-let sector is taxed, that the Government would like landlords with smaller portfolios to leave the sector. Whatever the Government’s ultimate intentions, however, there can be no doubt that landlords with small portfolios are currently critical to the provision of private rented accommodation, and the impact of any measures that could make the sector less attractive to them should be carefully thought through.
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Government response AI summary
The government acknowledges the importance of the private rented sector and values the involvement of all responsible landlords, regardless of portfolio size, and states that it wants a thriving private rented sector that helps to accommodate people's housing needs.
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Ministry of Housing, Communities and Local Government
18
Recommendation
Fifth Report - Reforming the Private Re…
Acknowledged
We recommend that the Government review the impact of recent changes to taxation rules in the buy-to-let sector, with a view to making changes to make it more financially attractive to smaller landlords. If it is not willing to do this, it should at least be much clearer about what …
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We recommend that the Government review the impact of recent changes to taxation rules in the buy-to-let sector, with a view to making changes to make it more financially attractive to smaller landlords. If it is not willing to do this, it should at least be much clearer about what role it wants the private rented sector to play in the wider housing mix and, in particular, whether it values the involvement of landlords with very small portfolios.
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Government response AI summary
The government acknowledges concerns about the impact of taxation rules but states that the intention was to level the playing field and the private rented sector remains stable in size.
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Ministry of Housing, Communities and Local Government
19
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
We welcome the Government’s introduction of a tourist accommodation registration scheme and its commitment to consulting on changes to the Town and Country Planning (Use Classes) Order 1987, but it remains to be seen if this will suffice to control the holiday-let market, which is having a serious impact on …
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We welcome the Government’s introduction of a tourist accommodation registration scheme and its commitment to consulting on changes to the Town and Country Planning (Use Classes) Order 1987, but it remains to be seen if this will suffice to control the holiday-let market, which is having a serious impact on some local communities around the country, especially coastal communities. In particular, it is not clear whether a registration scheme introduced under the provisions could place conditions on registration that would allow local authorities to control the spread of the holiday-let market.
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Government response AI summary
The government acknowledges concerns and notes that consultations were held on a registration scheme for short-term lets and a new use class, and the responses are being considered.
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Ministry of Housing, Communities and Local Government
22
Recommendation
Fifth Report - Reforming the Private Re…
Acknowledged
The failure of local housing allowance (LHA) rates to keep pace with market rents is quite obviously making the private rented sector even less affordable for many people who are only there because the social housing sector has been cut back and can no longer accommodate them. If the Government …
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The failure of local housing allowance (LHA) rates to keep pace with market rents is quite obviously making the private rented sector even less affordable for many people who are only there because the social housing sector has been cut back and can no longer accommodate them. If the Government believes the PRS is the right place for those on the lowest incomes, it should at least make sure housing benefit does what it was designed to do and covers benefit recipients’ housing costs. For this reason, it should increase LHA rates to realign them with the 30th percentile in each broad rental market area, and commit to conducting a review as soon as possible into whether they should once more be aligned with the 50th percentile.
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Government response AI summary
The government acknowledges the issue but does not commit to increasing LHA rates to the 30th or 50th percentile, instead highlighting Discretionary Housing Payments and a commitment to reviewing LHA rates annually.
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Ministry of Housing, Communities and Local Government
23
Conclusion
Fifth Report - Reforming the Private Re…
Acknowledged
When a tenant objects to an in-tenancy rent increase, they can refer their case to the First-tier Property Tribunal, which determines the market rent for the property. The Government says it will remove the tribunal’s power to increase rents and thereby give tenants greater confidence to challenge unjustified increases. If …
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When a tenant objects to an in-tenancy rent increase, they can refer their case to the First-tier Property Tribunal, which determines the market rent for the property. The Government says it will remove the tribunal’s power to increase rents and thereby give tenants greater confidence to challenge unjustified increases. If this proposal has the desired effect, it ought to result in a heavier workload for the tribunal, yet the process is time-consuming and resource-intensive, as it relies on each individual property being physically inspected and on both parties presenting evidence of local market rents based on online listings. This is inefficient and results in uncertainty for both landlords and tenants around what a justified increase would be.
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Government response AI summary
The government states rents should be agreed between landlords and tenants, and it is not for government to intervene. The First-Tier Tribunal is best placed to resolve disputes, and it will update guidance to support all parties in engaging with the Tribunal.
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Ministry of Housing, Communities and Local Government