From specialist landlord & tenant lawyer Tessa Shepperson of www.landlordlaw.co.uk.
2015 has been a big year for changes in the private rented sector. In fact I can’t remember a year when we had so much going on.
In this article I give you a bit of a round-up of the legal changes during the past year.
The Kumarasamy case
The year started fairly quietly with not a lot happening in January. However February brought the startling case of Edwards v Kumarasamy. In this case the Court of Appeal held that
• it was not necessary for tenants to give notice of disrepair if the problem was outside the property where the landlord (or his agent) could view it without entering the property (in the Kumarasamy case it was the path leading to the bins), and
• Despite the fact that the landlord had no right to do any repair work to the path (it being the responsibility of the freeholders) the landlord was nonetheless liable to the tenant due to s11 providing that landlords were liable for all areas where they have an ‘estate or interest’.
This was completely contrary to all previous authorities and caused not a little uproar. However the case is being appealed to the Supreme Court and it will be interesting to see what they make of it.
The Deregulation Act changes
Practically everyone heaved a huge sigh of relief when parts of the Deregulation Act 2015 came into force in March, which had the effect of cancelling out the problems stemming from the Superstrike case. So now:
• Pre April 2007 deposits paid for a tenancy where the fixed term ended after 7 April 2007 must now be protected (landlords were given a grace period until 24 June)
• However pre April 2007 deposits paid where the fixed term ended before 7 April 2007, do not need to be protected, unless you want to use s21.
• It is confirmed that the prescribed information only needs to be served once, if the tenancy continues after the end of the original fixed term with the deposit continuing to be protected, and
• It is also confirmed that landlords agents details can go on the prescribed information
April brought in new forms for section 8 and the rent increase notice under s13 of the Housing Act 1988. If you use these forms - make sure you are using the correct one!
We also now have a new prescribed form for section 21 notices – but only for tenancies in England which started or renewed on or after 1 October 2015.
Letting agent transparency rules
These came into force in May. Letting agents must now
• Display details of their fees in their office and on their website
• Fees must be inclusive of VAT and
• Specific (e.g. no vague ‘admin charges’)
• Agents must also state what Property Redress Scheme they belong to and
• Whether they have client money protection insurance
If you are an agent and are unsure how to deal with the new rules, ARLA have published some helpful templates.
As always it is taking time for agents to become aware of and comply with these rules. However agents are at risk of a hefty fine if they don’t comply.
Note that these rules are in addition to the existing consumer legislation and Advertising Standards Authority guidance.
Section 21 changes and smoke alarms
In October the rest of the changes in the Deregulation Act 2015 came into force which mainly affected the use of s21 for English tenancies which started or were renewed on or after 1 October 2015.
The regulations first added some new pre-requisites for using s21 (in addition to the existing pre-requisites relating to HMOs and deposits):
• Landlords must have served a gas safety certificate and
• An Energy Performance Certificate, and
• The most recent version of the governments How to Rent booklet
Other changes included the new ‘anti retaliatory eviction’ measures which provide that landlords cannot serve a valid section 21 notice for six months after service on them of an improvement notice by the Local Authority, and further, any existing section 21 notice served after a complaint by the tenants on substantially the same issue will become invalid.
There are also new time limits for serving and using section 21 notices.
Finally, as discussed above, there is now a new prescribed form of section 21 - but only for new or renewed tenancies in England from 1 October 2015. Make sure by the way that you are using the correct form as the original form published had an error and an amended form had to be issued at the last minute.
October also ushered in the Smoke and Carbon Monoxide Alarm (England) Regulations 2015 requiring landlords to fit smoke alarms on every storey where there is living accommodation and a carbon monoxide in every room where there is a solid fuel burning appliance.
There was much criticism of these regulations and the short notice given to landlords. Indeed I have read that there were not actually sufficient smoke and CO2 alarms available in the country to enable all properties to become compliant!
New rules in Wales
You may have noticed that many of the changes above apply just in England. However Wales is also facing huge upheaval in its legal system, starting with the Housing (Wales) Act 2014 which will require all landlords and letting agents to be registered and all those managing property to be accredited.
The new rules came into force on 24 November and Welsh landlords and agents have one year to comply. The Rent Smart Website where you have to do this is here.
Its not over yet
Despite the big changes which have taken place in 2015, the Government are on a roll and are determined to bring in yet more regulation.
February 1 will bring in mandatory ‘right to rent’ checks in England, there is a new Housing and Planning Bill bringing in more penalties for rogue landlords, and we are told that changes to the HMO licensing rules are likely.
So what are we to make of all these changes? Well, it is certainly becoming a more difficult time to be a landlord. Along with increased regulation is increasing enforcement of the rules with Local Authorities becoming more proactive. As Magistrates Courts fines are now unlimited, it can be very expensive for landlords who are not compliant.
Clearly the day of the amateur landlord is over. If you are not renting your property through a letting agent (and note that you need to choose your agent very carefully as you are legally responsible for their actions) it is essential that you know what you are doing and get proper training on your legal obligations.
We also have an annual Landlord Law Conference in May, which this year is in Manchester, which will feature 10 talks from specialist housing lawyers on the major areas of change.
It has never been more important for landlords and agents to keep up to date with the law, so make sure that you do!
Note by the way that the new rules above are only outlined in brief and a lot of important detail has been left out (or this article would be far too long!). You will find more information on my Landlord Law Blog at www.landlordlawblog.co.uk and (for members) on my Landlord Law site.