Rental property legal changes: A minefield for agents and landlords

 
Rajeev Nayaar
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New laws will shift balance of power will shift in favour of the well informed party (Source: Getty)

A cornerstone of the buy-to-let boom will fundamentally change on 1 October. With little guidance to assist and severe consequences for non-compliance, it looks like tricky times are ahead for landlords and letting agents.

Since 1988 a landlord wanting to get their property back at the end of a tenancy simply had to correctly complete and serve the right form of notice (a Section 21 Notice) at least two months before they wanted to get the property back.

But for every tenancy starting in England on or after 1 October this will change. The balance of power will shift in favour of the well informed party, whether that's the landlord/agent or tenant.

First up, landlords and agents will have to get to grips with a new form of Section 21 notice. To make things even more confusing, the full details have yet to be finalised due to a drafting error in the new form of notice passed by Parliament. But the changes will take effect soon.

Secondly, there are new timeframes for serving a Section 21 notice. These are designed to ensure that a landlord only serves a Section 21 notice when they actually want to get their property back, so that tenants have more certainty over how long they can stay in a property.

Read more: Bank of England may put cap on lending for buy-to-let landlords

There is also a new set of documentation which has to be provided to a tenant in order for a Section 21 notice to be validly served. This includes key property documentation such as a gas safety certificate for the property and general information such as the Department for Communities and Local Government's “How to rent: the checklist for renting in England”.

Finally, to stop a landlord from choosing to evict a tenant in response to a repair request rather than fixing the problem (known as a retaliatory eviction) there is a new process for dealing with repairs.

The upshot is that the acts of omissions of a landlord (or their appointed agent) during a tenancy can prevent a landlord from regaining possession of a property. In the case of the provisions to prevent retaliatory eviction that prevention can last as long as six months, meaning no rent increase and a tenant in place who knows that their landlord wants them out. Put simply, trouble all round.

For agents who keep abreast of regulatory changes, and have the right processes in place, the additional complexities should be a boon for business. Self-managing just got harder for landlords, and their competitors may well fall foul as test cases find their way through the courts.

For those who don’t, tricky times are ahead.

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