Renters' Rights Bill

Written evidence submitted by The Property Institute to The Renters’ Rights Public Bill Committee (RRB24).

About The Property Institute

1. TPI is the professional body for residential property managers, managing buildings across the UK in which private renters, social renters, leaseholders, and commonholders live.

2. Comprising around 6,500 property managers and over 360 managing agent firms collectively, the TPI’s members manage over 1.5 million leasehold homes in over 55,000 residential blocks and estates in England and Wales, freehold flats in Scotland, and institutional build to rent across the UK.

3. The Property Institute (TPI) was formed in March 2022 following a merger of the Association of Residential Managing Agents (ARMA) and the Institute of Residential Property Management (IRPM), the trade and professional bodies of the residential property management sector and has a combined legacy spanning over 50 years of experience.

4. TPI’s mission is to raise standards in residential building management, improving the lives of millions of residents and tenants. TPI actively supports its members to continually improve building management standards through their work and ongoing professional development; ensuring people’s homes are managed competently, safely, and ethically.

5. In addition to its extensive membership network, TPI accredits and audits member firms against its Consumer Charter and Standards, TPI delivers a diverse range of OFQUAL accredited qualifications, comprehensive training course, and Continuous Professional Development (CPD) via seminars, workshops, webinars, conferences, and events. The Institute has awarded 10,000 qualifications to its professional members over the last two decades.

Executive Summary

6. TPI supports the Government’s aim to improve the lives of renters across the country via the Renters’ Rights Bill ("the Bill").

7. TPI is keen to ensure that the Bill improves the safety and security of private renters by driving up standards of those managing homes in the private rented sector (PRS), while also delivering equity of protections with social renters.

8. Currently, property managers in the private sector are unregulated, unlike in the social housing sector. Anyone can set up as a property manager in the private sector, without any qualifications or proof of competency to carry out the work.

9. Lack of regulation or mandatory qualifications for professionals leaves residents in the private sector unprotected from rogue operators, putting renters’ safety, finances, wellbeing, and security at risk. For example, security systems in a building may not be maintained or compliant fire safety measures implemented.

10. TPI calls for all property managers in the private sector to be required to obtain a relevant qualification, to mirror requirements already introduced in the social housing sector through the Social Housing (Regulation) Act 2023.

11. Mandatory qualifications would ensure that all property managers are appropriately qualified in the following essential areas:

· Technical knowledge – understanding relevant legislation/regulations, the implications of different tenures, and the processes and policies that must be followed to carry out the work of a property manager;

· Customer service – understanding how to communicate well with residents, listen to their concerns and take appropriate action;

· Ethics – understanding the appropriate behaviours and code of conduct that a property manager must follow;

· Safety – understanding the role of a property manager in keeping residents in a building safe, including in the context of the Building Safety Regime for tall buildings.

Improving safety and security in the PRS

12. According to Government estimates there are 1.6 million leasehold flats in England which are let to private rented sector tenants. [1] Leasehold flats are usually in buildings with shared common areas and so often have a property manager to look after the building.

13. Further, TPI’s members currently manage homes that are usually flats within buildings with shared common areas, thus requiring a property manager to look after the building.

14. However, despite the significant number of homes being let to residents in buildings that require property managers to look after and maintain the building, currently, anyone can set up as a property manager in the private sector without having to prove any level of competency or qualifications.

15. Responsible and ethical property managers need to know about safety, the law, insurance necessities, financial control reporting and accountability, environmental regulations, and many other things. Most people, when they consider a block of flats, would assume that the person responsible for looking after it was appropriately qualified, and not simply an amateur.

16. This lack of required qualifications allows incompetent and rogue actors to take on the management of buildings, the failure of which can have a devasting impact on renters’ lives. For example, a property manager in the PRS that fails to maintain the security systems of a building, or fulfil their responsibilities regarding fire safety, could seriously threaten renters’ wellbeing and safety.

17. By contrast to this lack of protections for renters against incompetent or rogue property managers in the PRS, the Social Housing (Regulation) Act 2023 (‘the 2023 Act’) includes specific provisions [2] requiring property managers in the social housing sector to be suitably competent and qualified. These provisions are in the process of being implemented, with secondary legislation anticipated.

18. This inconsistency in standards between social housing and the PRS is particularly apparent in the many residential blocks across the country that are of mixed tenure. In any such mixed tenure block, a home on one side of the corridor may require their property manager to be qualified as that home is a socially rented home. However, two neighbouring homes on the same corridor may be PRS homes and therefore not requiring a property manager to be qualified.

19. Put simply, this inconsistency in standards means that those living in social housing have greater protections from incompetent or rogue property managers than those living in PRS homes.

20. The report into the Grenfell tragedy by Rt Hon Sir Martin Moore-Bick found that there were serious failures in how the building was managed from a fire risk perspective. [3] The report concluded that subsequent legislation (the 2023 Act) introduced to ensure property managers in the social housing sector are appropriately qualified, was a crucial response. However, vulnerable people live in the private sector too and it should not take another tragedy, this time in a private block, before action is taken.

21. Consequently, TPI proposes an amendment to the Bill to introduce mandatory qualifications for property managers in the PRS by mirroring the qualifications requirements being introduced in social housing under the 2023 Act.

Other matters

22. TPI notes provisions in the current draft of the Renters Rights Bill giving tenants the right to request to keep a pet (Clause 10) and precluding landlords from discriminating against tenants with children or tenants on benefits. (Clauses 32-37, 42-43 and 49-51). Without prejudice to the respective merits of these provisions, TPI considers that they each need careful review to check how they will work in practice. For example, how Clause 10 will work in circumstances where there is both a Landlord and also a superior Landlord. And, how Clauses 32-37, 42-43 and 49-51 will work in the context of a tenancy in a property designated for the exclusive use of older adults via a restriction, covenant or lease term which sets a "minimum age" for those living in the property.

Summary of main recommendation

23. The Property Institute recommends the following amendment to the Bill to improve the lives of renters in the PRS and proactively protect renters across the country from incompetent or rogue operators:

Extend the requirement for property managers to be qualified in the social housing sector to also include the private rented sector

October 2024.