Landlords Outraged At Right To Rent Prison Threat

Landlords Outraged At Right To Rent Prison Threat

Landlords Outraged At
Right To Rent Prison Threat 

Private rental sector landlords and letting agents have expressed outrage over proposed amendments to the forthcoming Immigration Bill (2015) expected to be introduced in September, when MPs return from their summer break.

Section 20 – 37 of the Immigration Act 2014 contained the provision to make it compulsory for landlords to check the immigration status of all new adult tenants. Now officials want to enforce the measures, in order to strengthen their grip on the private rental sector (PRS).

The official line on landlord expectation is that the majority believe that the amendments will make the enforcement of the Right to Rent checks clear and less ambiguous, empowering landlords to take steps to evict the tenant, after a short notice period, without the need for a court process for repossession, unless the eviction requires the use of force.

However, the Government clampdown on the private rented sector and renting to illegal immigrants includes amendments that could see landlords imprisoned for breaching what the Government sanctions are their responsibilities within the Right to Rent checks. PRS landlords repeatedly failing to evict illegal immigrants could be imprisoned for a maximum sentence of five years and still face a fine of £3000 (GBP).

Landlords were already outraged that they were being forced to act as unpaid members of the UK Border Agency, but adding the threat of imprisonment adds even more insult to injury. The moves are almost forcing landlords to become xenophobes and racists, only renting property to English people who can prove they were born here.

That is not what we are in property for, the idea is to provide a good standard of housing for the people who need and can afford it. It is not our job to discriminate, we operate a business and have to pay for services such as tenant referencing, in order to conduct background and affordability checks on applicants to help guide us towards letting property to honest, decent people.

Implementing enforcement measures on the people the Government need to do the job is bad for business and will drive the more risk averse out of the sector. This will reduce the supply of available rental properties, driving up rental prices and increasing the pressure on the PRS, which in turn exacerbates the UK housing shortage. Great thinking!

The chief executive of the National Landlords Association (NLA) Richard Lambert told Radio 4 last week that the plans could lead to tenants “doing very desperate things” and violent confrontations. Prompting the NLA to meet with Home Office officials in an attempt to clarify the implications for landlords and letting agents.

It is understood that, although no date has been set for national implementation, the Home Office are publically committed to introduce at least three new measures to be included in the Immigration Bill (2015).

These are:

  • Introduction Of A New Criminal Offence.
    The details of this offence are yet to be released, but is expected to focus on repeat landlord offenders and organised crime. Maximum penalty of five years’ imprisonment.
    Single offences will still see landlords fined £3,000 (GBP) and it is expected that only those landlords who repeatedly fail to carry out Right to Rent checks and/or refuse to end tenancies when instructed to by the Home Office will be prosecuted.
  • Introduction Of A New Ground For Possession.
    The Home Office has acknowledged that PRS landlords need effective means to end tenancies where a tenant does not to have the Right to Rent. It is expected that the new ground for possession will be used in conjunction with a section 8 notice, after amendments are made to the Housing Act (1988).
  • Introduction Of A New Legal Notice From The Home Office To Bring Tenancies To An End.
    This measure will allow landlords to end a tenancy, where the Home Office determines that the tenants do not have the Right to Rent and deems it necessary to terminate the tenancy.
    It is expected that the Home Office will serve this notice to the tenant, notifying them that they do not have the right to remain and that their tenancy will be excluded from mandatory protection, allowing landlords to subsequently serve a short notice on the tenant, ending the tenancy.

UK private rental sector landlords should not have to go to court to obtain an order for possession of their rental property, as the tenancy will no longer be considered to be an AST in England and Wales, although where necessary landlords may choose to use court bailiffs to carry out the tenant’s eviction.

There was mixed reaction to the proposals from landlord associations, with the NLA welcoming the introduction of new Home Office processes because it means that landlords will not have to apply to the courts for possession if the Home Office issue notice for their removal, or have to face the abandonment of property by tenants leaving to evade authorities.

The Association of Residential Letting Agents (ARLA) also welcomed the proposals in principal, with Managing Director, David Cox stating: “The plans will help to weed out the minority of rogue landlords who exploit vulnerable immigrants for their own financial gain and, with the introduction of a new five year imprisonment penalty, will help to deter other such unscrupulous individuals from entering the private rented sector.”

However, the Residential Landlords Association (RLA) warned that the proposals could backfire and see lawful tenants denied a rental opportunity, with RLA Chairman, Alan Ward stating that “While the RLA support the crack-down on rogue landlords exploiting illegal immigration, it isn’t fair to put all the burden on landlords, as they are not immigration officers and cannot be expected to readily identify documents and visas with which they are totally unfamiliar and it will require adequate resourcing. Given the increased penalties announced, landlords will err on the side of caution and may even deny accommodation to those fully entitled to it.”

The proposals drew a similar response from Generation Rent, with policy manager, Seb Klier, describing the proposals as dangerous, stating;“The threat of jail will make landlords so risk-averse that tenants who happen to have a foreign-sounding name could find it harder to find a place to live. Linking immigration status to housing is likely to increase discrimination and drive very vulnerable tenants into the hands of criminal landlords,” he said.

The Right To Rent scheme was originally piloted in Birmingham, Wolverhampton, Dudley, Sandwell and Walsall in the West Midlands from December 2014, requiring landlords and letting agents to check the immigration status of all new adult tenants, sub-tenants and lodgers entering into new tenancies to assess whether they have Right to Rent in the UK.

The Guardian newspaper reported that investigations into the Right to Rent pilot scheme discovered that since the scheme’s introduction, only half of tenants looking for PRS rental properties in the pilot area were actually asked by a landlord or letting agent if they had permission to stay in the UK. The newspaper also found the pilot scheme may have encouraged landlords to discriminate against prospective tenants from overseas, reporting that during a mystery shopping exercise they found non-Britons were blocked from renting properties on 11 out of 27 occasions.

Since the pilot scheme was implemented, *only seven West Midlands landlords have been prosecuted, being fined an average of £800 (GBP) each.

The Guardian newspaper reckons that their investigations suggest that the pilot is a failure.

*Data obtained by The Economist under the Freedom of Information Act

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