Weekly landlord news digest: Issue 36
In our weekly news round up from Hamilton Fraser Total Landlord Insurance, we bring you the latest industry highlights and talking points. This week, according to the latest data, the tenant fee bans in England and Wales are triggering higher rents.
Meanwhile, landlords have voted to go ahead with forming a new lobby group – the National Residential Landlords Association (NRLA), and leading tenant eviction company, Landlord Action, warns that scrapping Section 21 will lead to a rise in homelessness.
Finally, read on for updates on the latest court cases concerning landlords and letting agents.
Buy to let rents set to rise above £1,000 a month
Buy to let rents are poised to break through the £1,000 level, according to new data.
Although average rents in London and the South East have sat above £1,000 a month for some time, this has not been the case across the rest of the country.
But now one of Britain’s biggest letting agents, Countrywide, says rents for new tenancies are averaging £998 a month across the entire country after a 2.3 per cent year on year increase.
The South East and South West fared better for landlords, with rents rising by more than five per cent during the year to the end of August, while those in Scotland, Wales and the Midlands fell by up to 3.5 per cent.
Tenants are paying the most a month in London (£1,737) and the least in Scotland (£654).
“Rental growth on newly let properties has doubled since August 2018. Rents rose 2.3 per cent in August, more than twice the one per cent recorded in August 2018,”
– A spokesman
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Members back merger of UK’s two largest landlord organisations
Landlords have green lighted proposals to merge the UK’s two largest landlord trade bodies into an 80,000 strong super group.
Following meetings held earlier this week, members of the National Landlords Association and the Residential Landlords Association have voted for the two organisations to unite to form the National Residential Landlords Association (NRLA).
The new trade body will officially launch on 1 January 2020.
Chairmen Alan Ward (RLA) and Adrian Jeakings (NLA) said in a joint statement: “We are delighted that landlords have backed plans for a new, stronger body to represent them and their interests.”
“The new organisation will have a more powerful voice to support landlords, provide services to them and to lobby government. Both organisations will now move forward together to appoint a new chair and directors for the NRLA. We will be seeking candidates internally and externally and we would welcome expressions of interest from members for these posts.”
– Chairmen Alan Ward (RLA) and Adrian Jeakings (NLA)
Scrapping Section 21 will trigger a rise in homelessness
Leading tenant eviction company, Landlord Action, says that as many as 50 per cent of Section 21 (the “no fault, no blame” eviction process) cases they handle are as a result of tenants wanting to be re-housed by the council.
They believe the abolition of Section 21, and subsequent expansion of Section 8, could put thousands of tenants at greater risk of receiving a County Court Judgement (CCJ) and ending up homeless as local councils will not be obliged to re-house those with rent arrears judgements.
According to Landlord Action, 95 per cent of Section 8 cases are for mandatory two months’ rent arrears.
It is unknown how many Section 21 cases are as a result of rent arrears, but Landlord Action says it is the number one reason landlords serve notice. Read the full story on LandlordZONE.
The warning comes in the same week that the Liberal Democrats passed a motion at their conference which would result in the scrapping of Section 21, if they ever came to power, or have any influence in a coalition, after the next general election.
Removing Section 21 is currently under review by the Conservative government, and it is also the policy of any incoming Labour government.