Private landlords update on the market and legislation

Eddie Hughes, the minister responsible for the Renter’s Reform Bill and accompanying White Paper resigned this month as the new Government administration took office.

The legislation and proposals he put forward sought to swing power in favour of tenants by removing the landlord’s Section 21 powers. These have caused widespread concern across the industry about what would be put in its place to combat problem tenants and particular anti-social behaviour.

It’s too early to determine whether the current proposals will be continued under the new housing secretary. The changes in administration has led many to believe that the final Bill will not pass before the end of 2023 even if it stays in its current form.

With a pause in changes to regulations brought by the Bill, the industry spotlight falls on the lack of rental supply and the increase in rental yields. According to Zoopla, ‘the average rent in the UK has increased by £115 per month since last year, reaching £1,051 per calendar month.’ This leaves a tenant on an average single person wage paying over 30% of their wages on their rent.

The portal’s most recent lettings sector market snapshot has highlighted how the cost of living squeeze is affecting the private rental market, with tenants looking for one and two-bed flats rather than two and three-bed houses. At Poole Townsend, we’ve not seen any noticeable change in our local lettings market. We are still challenged by limited stock in Ulverston, Barrow, and Dalton, and properties that are coming available in Kendal are being let within minutes. Due to the high demand from tenants for any suitable options we’ve not seen a shift in the type of properties that are being let that other areas have experienced.

Richard Donnell, Zoopla’s executive director, states, ‘There is a risk that more regulation to improve standards or potential new measures to dampen rental growth, as proposed in Scotland, may compound the supply problem which is pushing rents up in the first place. Policymakers need to tread a careful path between protecting consumers and ensuring a decent supply of homes for rent.’

Current regulation
We’ve discussed greater regulation affecting the industry before in our previous landlord updates:

Electrical Safety Standard Regulations - Electrical Installation Condition Report (EICR)
Required since April 2021, to ensure all electrics are safe and inspected every 5 years.

Right to rent verification - Process now digitally available for landlords and tenants to share documentation.

Smoke & Carbon Monoxide Alarm Regulations - into force on 1st October
A carbon monoxide alarm is required in each room where there is a gas appliance (other than a gas hob or oven). So rooms containing gas fires, gas wall heaters, gas boilers, gas water heaters, open fires, AGA etc all require an individual alarm.

EPC Certificates - minimum C grading on EPC certificates before 2025.

The existing and upcoming legislation have all placed increasing pressure on private landlords. Many have felt this is the tipping point and have looked to offload some or all of their property portfolio to limit their losses or get out of the industry altogether.

We’ve got no evidence of this in the area that Poole Townsend covers. It was highlighted in Zoopla’s property snapshot that fewer investment and landlords selling up have resulted in no real growth in the rental market in terms of properties since 2016.

You’re in safe hands
At Poole Townsend we support a range of different landlords offering support to those with one property to those with a diverse portfolio across our region. As a lettings agency within an estate agency we can guide those looking to grow or reduce their number of properties and advise on improvements required for increased energy efficiency (EPC) rating.

With new legislation constantly changing, it’s hard to keep up. Our experts can help you enjoy hassle-free property management whilst maximising your investment. Get in touch with our experts. Andrew & Louise for an informal chat as to how Poole Townsend can support you.

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