Longer tenancies – agents’ consultation responses could be key

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Longer Tenancies:

PropTech provider PayProp is encouraging letting agents and property professionals to respond to the government’s consultation on longer tenancies.

The automated rental payment platform says agents’ input could be vital in shaping the future policy framework as the industry experiences ongoing change, putting pressure on existing rental tenures.

There’s not long left to contribute

Back in July, the government launched an eight-week consultation on the subject of longer tenancies.

The Ministry of Housing, Communities and Local Government said a rise in families and older people renting meant there is a growing need for ‘longer, more secure tenancies than the minimum six months offered by the assured shorthold tenancy regime’.

The consultation discusses the pros and cons of introducing a three-year minimum tenancy with a six-month break clause. It also outlines a number of questions for respondents to answer.

“Letting agents who want to have their say on the government’s plans to introduce longer tenancies don’t have long to respond to the consultation, as it closes on August 26,” says Neil Cobbold, chief operating officer of PayProp UK.

“Consultations are designed to give important stakeholders a voice in shaping future legislation. For something as significant as overhauling the current structure of tenancies, the more agent and landlord feedback received by the government, the better,” Cobbold says.

Agents’ experience is valuable

Letting agents’ varied industry experience – working with different landlords and tenants at a range of properties over a period of time – could be extremely valuable to politicians shaping the proposed framework around longer tenancies.

“Dealing with new tenancies and renewals on a regular basis means letting agents are well placed to provide feedback on typical tenancy lengths and any potential issues or unintended consequences with longer minimum tenancy agreements,” explains Cobbold.

“Agents also speak daily to landlords and tenants so they will be able to provide useful insight into the consumer reaction to these proposals and whether longer tenancies are something landlords and tenants are keen to see introduced.”

A seismic change for the rental sector

The government’s proposals for a new tenancy framework represent a complete overhaul of the current assured shorthold tenancy (AST) structure.

Should the new proposals be introduced, there’ll be new rules on notice for leaving a tenancy and notice for regaining a property, which will only be possible if the landlord has ‘reasonable’ grounds.

There are also plans to limit rent rises to just once per year at a pre-agreed rate.

“These proposals would represent a significant change in processes for letting agents and landlords operating in England,” says Cobbold.

“Last year, there were similar regulatory changes made in Scotland when the Private Housing (Tenancies) (Scotland) Act 2016 was introduced. It would be beneficial for English stakeholders to find out more about the new Scottish system, how it has changed the market and what mistakes could be avoided.”

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