Renting reform bill progress unlikely until much later this year, admits minister

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The Government’s Renters Reform Bill is unlikely to make progress through parliament until much later this year, housing minister Rachel Maclean has admitted.

Maclean was unable to confirm when the bill would get a second reading during a Q&A with MPs from the Levelling Up, Housing and Communities committee. It is tasked with scrutinishing official policy and performance in housing.

Asked by chairman Clive Betts about the legislation’s slow progress through parliament (it was given its first reading on 17^th May but has since then ‘got stuck’), Maclean hinted that it was unlikely that it would get a second reading until after the Summer recess.

This is due to start on 20^th July and finish on 4^th September.

She said her hands were tied by the parliamentary business managers who decide how and when bills pass through parliament, and a quick look at the ‘what’s on’ website for the Commons and Lords shows no time allocated for the bill before the house rises.

Delayed

Michael Cook, Group MD of Leaders Romans Group, says: “Despite some big announcements recently from Government, it’s unsurprising that the second reading of the Renters Reform Bill is delayed until at least the Autumn.

“As an industry we are concerned that a number of the elements of the Bill are unclear and need amending to make it workable.

“Giving MPs and the Select Committee a bit more time to liaise and engage with all parts of the sector is probably not a bad thing.

“Specifically, and from both the landlords’ and tenants’ point of view, we are concerned about the impact of removing fixed terms. We also question how effective the new housing courts will be, given that we have heard of no clear plan.

“We suspect many MPs will share these concerns. This has possibly been sensed by Government and hence the brakes applied to allow for some of these issues to be addressed.”

Read more about the Renters (Reform) Bill.

View Full Article: Renting reform bill progress unlikely until much later this year, admits minister

Labour WARNED after claiming ‘most renters live in homes bought via BTL loans’

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A team of independent fact checkers and campaigners has debunked Labour’s claims that most renters live in homes bought with a buy-to-let mortgage.

Deputy leader Angela Rayner made the assertion last week, but charity Full Fact says the claim is technically incorrect, as it holds true only for the private rented sector, not for overall rentals. When social renters are included in the total, about a third of renters live in buy-to-let properties.

False or misleading

Full Fact says all MPs, including shadow ministers, should correct false or misleading claims as soon as possible in their capacity as public representatives. 

The English Private Landlord Survey found that in 2020/21 the PRS in England accounted for just over 4.4 million households. Over half (57%) were BTL landlords with an existing mortgage, representing 61% of privately rented tenancies. 

Regulator of Social Housing statistics show that a further 4.4 million homes are being rented from both private and local authority registered providers. This means that roughly 8.8 million households live in rented accommodation in total, of which 2.7 (31%) million are owned by buy-to-let landlords. 

Supply gap

Although there have been concerns that rising mortgage interest rates could drive many of those landlords with existing buy-to-let mortgages out of the market, Aneisha Beveridge (pictured), head of research at Hamptons, told Full Fact: “We estimate that by the end of this year, landlords are likely to have sold 303,840 more buy-to-lets than they bought since 2016 which was when a raft of tax and regulatory changes were introduced.

“That said, these numbers won’t reflect the rise in the number of institutional investors buying-in through schemes such as Build to Rent which will have helped close some of that supply gap.”

View Full Article: Labour WARNED after claiming ‘most renters live in homes bought via BTL loans’

Horrendous overcrowding at dilapidated HMO leads to £17,000 fine for landlord

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A letting agency-owning landlord has been fined more than £17,000 for renting out one small room in an HMO to a family of five.

Ruhul Shamsuddin and his company Lordsons Estates were found guilty of 23 housing offences relating to a property in Clifftown Road, Westcliff-on-Sea (pictured).

Colchester Magistrates Court heard that an inspection in December 2021 discovered a breach of several HMO licence conditions.

Waste

Officers from Southend-on-Sea City Council’s private sector housing team found the property had disrepair to windows and staircases, a lack of fire safety, and waste underneath an outside staircase.

Officers also found evidence of overcrowding where one family, with two adults and three children, were living in one room.

The HMO licence was revoked immediately and a prohibition order served to prevent anyone staying at the house until it had been made safe.

At the sentencing hearing at Basildon Magistrates Court, Shamshuddin and the company were fined a total of £17,293.

Councillor David Garston (pictured), cabinet member for housing and planning, says landlords who exploit the vulnerabilities of people in need and provide substandard and unsafe accommodation will be caught and face the consequences.

He adds: “I’m so pleased we were able to relocate this family living in overcrowded conditions. The fact that the courts recognised the seriousness of the charges and imposed such a fine as this sends the right message out to others who may want to flout the rules.”

Lordsons Estate has an active website and is still trading but its accounts are overdue at Companies House where it currently faces an active proposal to strike off.

Read more about HMO fines.

View Full Article: Horrendous overcrowding at dilapidated HMO leads to £17,000 fine for landlord

Order of possession granted- What do I need to do next?

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Hello, I have a problem tenant and served S21 in April. Only since the S21 expired the tenant has started to default on payments and I have only made 30% of the rent.

I used the accelerated possession process to get an order of possession.

View Full Article: Order of possession granted- What do I need to do next?

Landlord mortgage arrears outstrip home owners’ as costs squeeze profitability

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Landlords’ arrears are growing at a faster rate than homeowners’, according to new research that suggests fewer investors are being shielded from economic headwinds.

Octane Capital found that buy-to-let arrears of more than 2.5% of the loan amount have risen by 42% in four years, from 4,930 in Q1 2019 to 7,030 in Q1 2023, accounting for 0.34% of total outstanding buy-to-let loans.

Similar arrears for homeowners have dropped by -8.6%, from 83,870 in 2019 to 76,630 this year, accounting for 0.87% of total homeowner loans outstanding.

While arrears are far from out of control, many mortgage holders are likely to struggle when they re-mortgage, with typical five-year fixed mortgage rates now climbing above 6%.

But Chancellor Jeremy Hunt’s mortgage charter – allowing anyone worried about their mortgage repayments to switch to an interest-only mortgage for six months without impacting their credit score – doesn’t cover landlords.

High inflation

CEO Jonathan Samuels (pictured) says mortgage rates and high inflation are stretching affordability to the limit, with landlords unable to entirely recoup their lost income in the form of higher rents.

But the research suggests levels of arrears are in no way out of control, says Samuels.

He adds: “The Chancellor’s mortgage forbearance measures are designed to reassure people who are worried about the impact of rising rates, and it’s welcome these measures have been introduced before the horse has bolted – cases of arrears need to be tackled before people fall into trouble.

“We’d still recommend mortgage holders to keep paying their loans as normal unless they are in need of emergency action, as measures like interest-only loans will only result in higher payments down the line to compensate.”

Read more about mortgages. 

View Full Article: Landlord mortgage arrears outstrip home owners’ as costs squeeze profitability