A call for more rental reform has been made to make the lettings industry
more transparent and fairer.
The call comes from Neil Cobbold, the managing director of PayProp, the
automated payment service.
He says that politicians who are currently drafting new rent reform rules
should offer all sides of the lettings sector a chance of voicing their
opinions.
Mr Cobbold says that any regulation for the private rental sector should
not alienate letting agents and landlords.
‘Landlords are more likely to be onboard with changes’
He explained: “Agents and landlords are more likely to be onboard with any
changes if they feel their concerns are heard.
“The rhetoric around rental reform is how one group or another will be
harmed, or the dangers of over-regulation.
He added: “Good landlords and agents, and good tenants, have more in common
than sets them apart, and they need, ultimately, each other.”
In England, the rental sector is taking part in discussions over the Rental
Reform White Paper that is expected this spring.
And in Scotland, there’s a new consultation that will run until April on
the ‘A new deal for tenants – draft strategy’.
Major stakeholders are being consulted
Mr Cobbold says he’s pleased to see that major stakeholders are being
consulted ahead of planned reforms for Scotland and England.
He said: “When it is done for the right reasons, there’s nothing wrong with
new regulations.
“The most respected industries and professions have lots of checks and high
levels of regulation in play.”
He said that regulation used to improve standards will work best, but not
when it acts as a disincentive.
Also, councils will need the expertise and resources to enforce any new
rules or agents and landlords will lose faith in the new laws if they feel
there is not ‘a level playing field’.
‘Rental reform in practice’
Mr Cobbold said: “It will be interesting to see rental reform in practice
and how much industry backing it gets. This could be the difference in how
effective it is.”
The managing director of Accommodation for Students, Simon Thompson, said:
“Until we see what is contained in the Rental Reform White Paper, landlords
will continue offering quality rental properties for tenants and they will
do this effectively.
“However, there will be landlords worried about what the reforms contain,
particularly if there’s an impact on profitability which could see more
landlords leaving the sector when there’s growing demand for quality homes
to rent.”
The fear of landlords selling off their property portfolio is already an
issue for the Scottish Association of Landlords (SAL).
They have questioned 635 members who own 4,214 rental properties, to find
that one in three is looking to reduce their portfolio.
‘Anti-landlord rhetoric’ is ‘demonising’ landlords
The organisation’s chief executive, John Blackwood, points to
‘anti-landlord rhetoric’ as ‘demonising’ landlords that could lead to
thousands of rental homes being sold and leaving tenants struggling to find
somewhere to live.
He said: “Our members are clear, demonising landlords will lead to fewer
homes in the coming decade being available to rent.
“We know many tenants are not normally in a position to access
homeownership, and those tenants who can access the private rental sector
will put pressure onto a strained homelessness and social housing
services.”
He added that the only way forward in dealing with Scotland’s current
housing crisis is to increase the supply of homes for rent.
Fears in Scotland are being mirrored in Wales with a survey from
Propertymark revealing that Welsh letting agency members are reporting
growing numbers of landlords leaving the sector.
Five landlords in every branch leaving
They say there are five landlords in every branch leaving; that’s double
the national average – and higher than is found in any other region.
Propertymark points to the likely cause being the Welsh government’s plan
to extend notice periods, and enforce other restrictive measures, as part
of its Renting Homes (Wales) Act which will be implemented later this year.
Nathan Emerson, the chief executive of Propertymark, said that the trend of
landlords leaving the sector is already hitting tenants.
He added: “With several changes from the implementation of the renting act
on the horizon, landlords will face further regulatory pressure.
“Coupled with high demand in the sales market in parts of Wales, this could
contribute to landlords exiting the sector.”
London rents enjoy strong recovery
Meanwhile, it has been revealed that landlords in London have seen their
rents surpass the pre-pandemic levels.
Real estate firm Chestertons says that strong tenant demand and the return
of the ‘corporate tenant’ in the prime and super-prime London market has
led to an uplift in rent prices.
There’s also an undersupply of properties for rent adding to rent
pressures.
Capital’s average weekly rent is now at £751
Their figures reveal that the capital’s average weekly rent is now at £751,
that’s 21% higher than 2020’s figure of £589.
The firm’s head of lettings, Richard Davies, said: “Tenants who secured a
property at a discounted rent during the pandemic will be keen to hold on
as long as possible, particularly with rising living costs.”
He also pointed to the return of international students and office workers
to deliver ‘unprecedented demand’ in London’s rental market that is
outstripping supply.
