Here is our weekly Newsround, and what a week of news! Hot off the press we have a new housing minister – how will that affect the newly published White Paper?
Gove out and Clark in!
Greg Clark is the new Housing Secretary, with responsibilities including steering the Renters’ Reform Bill through parliament.
He is part of a new Cabinet named by outgoing Prime Minister Boris Johnson in a bid to show he can form a working caretaker government which can function until a new Conservative leader is elected in the early autumn.
Clark, 54, is Tory MP for Tunbridge Wells and has previously served as a junior minister of state in the Housing and Communities department during the Conservative-LibDem coalition before becoming Secretary of State at the same department in 2015. He has also served as Financial Secretary to the Treasury.
Last month Gove led on the introduction of the controversial White Paper called A Fairer Private Rental Sector, which is widely seen as representing a shift of power from landlords to tenants. There may still be uncertainty over the future progress of the White Paper recommendations and the accompanying Rental Reform Bill, especially if – as expected – a new Prime Minister is eventually elected by the Conservatives over the course of the summer. Read more about this here.
Indeed, an opinion piece in Landlord Today wonders whether the demise of Johnson will bring in a return to ‘traditional conservative thinking’ concluding
this re-set is a timely opportunity to modify the Rental Reform Bill to create a modern, safe, effective private rental sector and not one shaped solely by the ruling party pandering to campaign groups in order to win tenants’ votes at the next General Election.
Well, we shall see.
Pet Damage is still a concern
Landlords typically spend hundreds of pounds repairing properties damaged by pets, but are unable to recoup their costs. That’s the claim from industry supplier The Lettings Hub which says more than three in four landlords reported damage by pets but with over half unable to recover their costs.
Pro-pet group AdvoCATS have commissioned a report called ‘What’s the damage?’ following Rental Reform White Paper giving tenants the right to request a pet. Jen Berezai says
With almost a third of landlords and letting agents surveyed stating pet damage costs of more than £1,000, it is clear more detail is needed on how pet insurance as a permitted tenant payment will work.
Our stats show that half of landlord and letting agents would prefer the option for a tenant to pay the landlord for pet damage insurance, so they have assurance that the policy is in place should anything go wrong.
What is also needed is more information at the outset of the tenancy; some tenants feel they cannot disclose that they have pets, but this can lead to problems further down the line
You can read more here.
A landlord’s revolt?
It looks as if the private rental sector will contract as a result of the threat of new regulations contained in the recent government White Paper (always assuming of course that it is not radically changed after recent events).
The Fairer Rental Sector White Paper (at the moment) proposes the abolition of Section 21 evictions, as well as the removal of the blanket bans on renting with pets and to those with children or on benefits, and doubling notice periods for rent increases. All properties will also, eventually, have to abide by a Decent Homes Standard.
Now the latest survey of landlord sentiment by Total Landlord Insurance found that 60 per cent of landlords oppose the abolition of Section 21 evictions. Fifty-seven per cent also oppose tenants being permitted to rent with a pet unless they can reasonably refuse. Fifty-nine per cent were also against plans to make a blanket ban on tenants renting with children or with the support of benefits illegal.
It is not all doom, however, as 60% are in favour of giving tenants stronger powers to cease arbitrary rent review clauses and support double notice periods when rent increases are justifiably implemented.
Read what Eddie Hooker from Hamilton Fraser has to say about this here.
And the White Paper rumbles on Property Investor Post paints a similar vane regarding System 21 and landlords, see what they have to say here.
But if you were poised to sell your property to escape the White paper proposals, better wait a bit and see what happens now.
Holiday lets clampdown in Wales
Councils will be able to control the numbers of second homes and holiday lets under new plans unveiled by the Welsh Government.
There will also be a licensing scheme for home owners and landlords who want to operate short lets, such as Airbnbs. There will be three new classes of property in the Welsh planning system: a primary home, second home and short-term holiday accommodation. Councils will then be able to make amendments to the planning system to require planning permission for change of use from one class to another.
There are also powers to be given to councils to apply for higher Land Transaction Tax (the Welsh version of stamp duty) on second homes and short lets. It has already been agreed that Welsh councils can charge up to a 300 per cent premium on council tax on homes that aren’t occupied all year round.
Drakeford, who leads the Labour Party in Wales, says
We will work with local authorities to develop a national framework, so they can put to us, proposals for increased land transaction rates for second homes and holiday lets, which they can then apply to their local areas.
The finance minister has written to the local authorities today, so that work can begin on those proposals.
Some of these measures are about making access to the market fairer. Others are about a better balance between second homes and holiday lets in local communities.
He goes on to say and you can read more here
The Welsh language housing communities plan which will be published in September will include proposals to give local people a fair chance in the housing market. In that context, we are investigating the possibility of reintroducing local authority mortgages here in Wales, particularly aimed at first time buyers.
In the context of the cost of living crisis, backing from the local authority would help people access those mortgages with greater affordability at the heart of those arrangements
These measures are by some margin the most draconian on second and holiday homes anywhere in the UK.
English councils have the power to double council tax bills on second homes not in use or let for at least 70 days per year.
Spot checks on holiday homes in England to ensure compliance with health and safety rules and deter anti-social behaviour have also been announced.
All short-term let properties in Scotland will require a licence to ensure they are safe and the people providing them are suitable, starting on October 1 this year.
Newsround will be back next week.