To Regulate Private Rented Sector
The Government has announced that there are to be new regulations introduced in 2014 to provide private rented sector landlords, tenants and leaseholders with additional protection when working with lettings agents or property managing agents.
The Department for Communities and Local Government (CLG) want the introduction of compulsory redress schemes for lettings and property managing agents will ensure that they can be fully investigated where information is not made clear on additional charges, administration fees or any other property or tenant related issue. The proposed measures are intended to provide a cheaper, easier way for landlords, tenants and leaseholders to pursue compensation from lettings and property managing agents if they have a complaint.
The conditions that have to be met by lettings and property managing agents to be a part of a redress scheme have now been published by the Government.
Conservative MP, Kris Hopkins, who has housing as part of his remit said:”Privately rented properties play an important role in providing flexible accommodation to many hard working people, who either do not want to buy property, or who are still struggling to save for a deposit. Having a redress scheme will provide confidence to both tenants and landlords that any problems with letting agents can be cheaply and swiftly resolved and provides an alternative to the court system. The conditions we are publishing set out our view of what needs to be considered in setting up a redress scheme that can give peace of mind to many people living and operating in the private rented sector and in leasehold accommodation. Residential leaseholders and freeholders also now have somewhere they can go to resolve the day-to-day management problems that can arise with property managing agents, without having to resort to a tribunal or court. We aim for schemes to come forward for approval throughout January 2014 and urge lettings and property managing agents to join one before it becomes a compulsory requirement.”
The Government announcement is intended to force lettings and property managing agents into joining a redress scheme, however many honest agents already belong to at least one organisation that will provide tenants, landlords and leaseholders with some form of grievance procedures, such as those provided by the Property Ombudsman or the Association of Residential Letting Agents (ARLA).
The conditions set out by Mr Hopkins and the Department for Communities and Local Government follow the recent publication of a tenants’ charter for the private rented sector, which informs tenants what they should expect from accepting a tenancy in the UK private rented sector and where they can turn to for help if something goes wrong.
The tenants’ charter includes information that provides more transparency on lettings agents’ fees intended to eliminate unreasonable practices and unfair charges, and should ensure that all prospective tenants know the costs in full before they sign an assured short-hold tenancy agreement (AST).
The Government is completely behind the development of the UK private rental sector as well as introducing further regulation, the CLG also heralded the new £1 Billion (GBP) Build-To-Rent Fund, which has already identified 45 potential schemes, and £10 Billion (GBP) of government-backed guarantees to encourage institutional investment in the UK private rental sector.
The Government intends to revolutionise the way new residential properties are built for the UK’s private rental market, to provide tenants with more choice and better quality of newly constructed properties.
Build-To-Rent is intended to boost the supply of quality rental properties and support longer-term tenancies, as well as increasing competition between landlords offering decent, reasonably priced accommodation for tenants.
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