Renters' Rights Bill

Written evidence submitted by Roy Wearing, private landlord (RRB69)

For consideration by the committee looking at the Renters Rights Bill

Please l et me introduce myself, I am a recently retired businessman, I mainly worked within the IT sector.  However, being self employed, it has always been difficult to secure a good pension for oneself.  I have therefore become a private rental landlord over the last 20 years, to give my wife and I some security in retirement.

I have lived in the Birkenhead area all my life, indeed my prop erties are located here.

I have a very small number of high quality properties, with good happy tenants, who in turn appreciate my efforts as a good, fair and understanding landlord.  I use a local family estate agent as the managing agent, so please forgive me if I use the wrong terminology in what I am about to say.

I have seen the need to improve the Private Rental Sector for many years and approve of both main parties intent to do so.

I generally agree with the content of both of the bills that have been put before parliament in the last 12 months.

I understand the latest proposal, by the labour party, is yet to be discussed fully, and further believe there is time for adjustments to the bill as I have seen it.

I hope you will consider the following, and lend your voice to amending, what I see as a probable cause for concern.

The issue, as I see it, is to do with rent increases: (all smaller text in quotes is from information I have been sent from Suzanne Smith – The Independent Landlord – who runs www.theindependentlandlord.com a lawyer turned landlord, blogger and podcaster.

"The Renters’ Rights Bill makes it compulsory for landlords to use the Section 13 statutory procedure to increase rent, and the notice period doubles from one month to two."

That seems perfectly reasonable to me

"As is the case at present, tenants will be able to challenge the rent increase at the First-tier Tribunal (FTT) by using the process under  Section 14 of the Housing Act .

Currently, the tribunal decides on the market rent for the property, and the rent increase is backdated to the date specified in the notice (unless it would cause "undue hardship" to the tenant, where the FTT has the power to delay the rent increase to the date of their "determination" (decision)."

Again perfectly reasonable 

"However, under the proposed new rules, if the tenant challenges the rent increase, it won’t come into effect until the date of the FTT determination, and the tribunal will have the power to delay the increase for a further two months.

Despite the fact there are few cases in the FTT at present, research from the  NRLA  shows that the average wait time from application to hearing is currently around 18 weeks. Where the FTT decides they need to inspect the property, the average wait times increase to 27 weeks.

As a challenge of s13 rent increase notice will delay the rent increase, and the process is free for tenants, they will have every reason to challenge even the most reasonable of rent increases. Even if the landlord is asking for a rent that is less than the current market rate, the tenant will have an interest in challenging the increase!  They will save money in doing so.

With an increase in the FTT’s workload inevitable, it is highly likely the wait times will increase further, probably to ridiculous levels

In the  Guidance , MHCLG justify this change by saying they wish to "ensure tenants are not unexpectedly thrust into undue hardship"

However, it doesn’t take into account that the rent increase will be legally justifiable, and not above the market rent, otherwise the FTT would have reduced the rent. It won’t be "unexpected", as tenants will have had two months’ notice of the rent increase, and more if they refer it to the FTT."

I believe this last section is not reasonable, in my opinion it goes too far.  It does not act in a fair way to "level the playing field", instead it will be so difficult for landlords to ask for a rent increase, as the amount of tenants going to the FTT will be huge causing a bottleneck in the system. There is no incentive for a tenant to accept a ny rent increase, without referring it to the FTT.

In time the rent being paid will be so far behind the market rate, and without the option of a section 21 to just ask for a property back in a no fault situation, landlords will sell up and reduce the availability of rented housing stock further.  Surely this goes completely against the need for more available housing?

I am making this appeal to you to lend your voice to this particular issue wit hin the Bill, as an onlooker, I have never had a tenant complain about any rent increase I have asked for, as I am a good , fair landlord, liked by his tenants.  However even my tenants will have reason to ask for a FTT ruling as they will save money if they do!

Recommendation

I believe that if the Bill passes without alteration to this issue, then the FTT will be overwhelmed with work leading to outrageous wait times in implementation, decent landlords will struggle to maintain market rents over time and will leave the sector in the medium term, reducing rental stock still further. Maintaining the current situation of applying the rent increase back dated to the requested date of rent increase , will maintain the workload of the FTT and still give renters the right to challenge excessive rent increases by unscrupulous landlords. The vast majority of fair rent increases will not be objected to, this will be a much more balanced outcome.

I am sorry this has been a long email, I hope you can see fit to try and persuade Matthew Pennycook etc to revisit this section and apply some common sense, so hopefully this bill can be slightly amended and give the PRS a Renters Rights Bill that is fit for purpose and one to be proud of.

Roy Wearing

October 2024