Landlords worry they can’t afford green property upgrades amid rising costs

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Rising costs are piling the pressure on private landlords who say they can’t afford to implement the measures needed to improve their rental property’s EPC rating, a bank says.

The Secure Trust Bank has found that investors and landlords fear that they will not hit the government’s proposed energy efficiency targets for their rental homes.

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Comment: what’s really behind the surge in no-fault evictions?

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A report in The Guardian newspaper says that the “Surge in ‘no-fault evictions’ prompts calls to renew UK-wide ban,” on section 21 evictions that is, as was the case during the Covid pandemic.

Tenants were protected from being removed during lockdown – however much they may have been in arrears – but tenants are now suffering “devastating consequences,” the paper says.

What the article fails to recognise is that the very threat of the removal of section 21 no-fault evictions, along with other prosed quite radical measures, has put the fear of God into many landlords, and consequently they are using the very mechanism which is under threat to remove tenants, so they can sell up.

Long-running campaign to remove section 21

Housing activists and homelessness charities have long complained about no-fault eviction notices being used to remove tenants who complain to their landlords about the property conditions and the need for repairs, the so called “revenge evictions”.

But landlords and eviction specialists such as Landlord Action have provided much evidence to show that these revenge evictions are a tiny minority of the whole and that most evictions are simply due to rent arrears and bad tenant behaviour – after all the vast majority of landlords want to keep good tenants as long as possible.

But this does not stop the outcry, even from people august as former head of the civil service, Sir Bob Kerslake, warning of a “catastrophic” homelessness crisis unless the government re-introduces the eviction ban on evictions that protected tenants during the Covid-19 pandemic.

An end to Section 21

The Conservative government promised to end the practice of no-fault evictions over two years ago and this is due to become law at sometime in the near future under the auspices of the Renters’ Reform Bill. This Bill and its radical overhaul of the Private Rented Sector in England is set out in the white paper, A fairer private rented sector but it has yet to pass into legislation, not likely before well into next year.

The proposed new reforming legislation, largely formulated under Michael Gove – at The Department for Levelling Up, Housing and Communities – who has now left the government, includes some sweeping reforms such as no fixed-term tenancies, restrictions on rent increases and longer notice periods, increasing tenants powers to challenge evictions, no bans on pets, DSS and families etc.

The pendulum appears to be swinging, shifting the balance of power away from landlords and too much into the hands of their tenants. What is frightening many landlords, giving them nightmares that they could be stuck with bad tenants, is that they may be unable to remove them indefinitely.

Strengthening eviction grounds

Yes, along with these new proposals go promises to strengthen the grounds on which landlords can seek redress when things go wrong. Given good responsible tenants the new rules would probably make very little difference, and after all most landlords would like to see their tenants staying indefinitely and most tenants leave amicably when the decide to do so. But when things go wrong its a different matter: arguing the landlords’ case in an English court of law’s adversarial system, to remove a really bad tenant, without the certainty of s21, can become protracted and very expensive.

That’s if the landlord can get the case to court in the first place. Given the current backlog of cases and the slow pace that these things progress, landlords have little faith that the promised improvements in dealing with bad tenants will ensue. What’s more, if all these cases must in future must go to a court hearing, rather than just a paper exercise, even more delays will be created – it could be chaos!

Landlord flight

The resulting landlord flight from buy-to-let is without doubt causing chaos as The Guardian article says, though it fails to mention that the threat of removing s21 is in any way a responsible, simply blaming instead the backlog of cases created by the Covid ban:

“The more than doubling in homelessness from no-fault evictions is largely down to the fact that landlords were prevented from using the eviction system for much of the pandemic as the government successfully moved to prevent a surge in homelessness, including its “everyone in” strategy on rough sleeping. But the latest figures show no-fault evictions are now causing more homelessness than in 2018/19 and 2019/20.”

Matt Downie, chief executive of homelessness charity Crisis told The Guardian:

“The prime minister must commit to introducing the renters reform bill, to help give renters proper protection from being hit with a no-fault eviction and set out a clear plan to provide genuinely affordable homes. Only through such decisive action can thousands more people be protected from homelessness in the coming months.”

A crisis situation in housing

When letting agents are resorting to sealed bid for tenancies, and bidding wars that are driving would-be tenants crazy are in evidence across the country, it underscores the plight that people are going through, desperate for good quality rental accommodation at a reasonable price.

The big sell-off is not only creating this massive problem at the middle and top end of the rental market, its exacerbating the eviction problem at the bottom end, resulting in a homelessness crisis.

The shortage of housing is seeing tenants queuing in the streets for a viewing at one end of the spectrum, and rents are being pushed up, by as much as 19 per cent over last year, while at the same time tenants are being thrown out onto the streets. It just does not make sense to me!

Some agents are even asking for tenant CVs to evaluate their applicants backgrounds as if applying for a job, before agreeing a new let. According to one London letting agency, Atlas Property, managing over 500 properties, the number of tenants submitting CVs to help them secure a let has jumped by 20 per cent over the last 12 months.

Where will it all end?

A spokesperson for the Department for Levelling Up, Housing and Communities told The Guardian:

“A fair deal for renters remains a priority for the government. We are giving councils £316m to tackle homelessness and make sure families are not left without a roof over their heads.”

A valid question is: will the new regime under Liz Trust and her team press ahead with Michael Gove’s radical reforms in their present form, or will they re-assess the whole matter of the private rented sector in England with a balanced view?

Is it not a good time to lobby government to come up with a more even handed approach to the reform of the sector, one that would give landlords an incentive not just to stay in the sector, but to invest more money into it. The sector has been ignored in the “mini-budget” but is it not crying out for tax reform as well?

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