MP’s Table New Proposals To Regulate Private Lettings Market

MP’s Table New Proposals To Regulate Private Lettings Market

Two new proposals have been individually tabled by Labour MP’s calling for the regulation of landlords and lettings agents.

Former Labour housing minister John Healey and veteran Labour backbencher, Sir Alan Meale, made the proposals in the House of Commons separately but both are calling for better regulation of the private rental sector

Mr Healey’s Bill seeks to introduce mandatory licensing for lettings and property managing agents and a ban on lettings agents charging fees and is called “The Letting Agents (Competition, Choice and Standards) Bill 2013-14”.

The objective of the proposal is to establish a national mandatory licensing scheme for lettings and managing agents, with established standards and redress for landlords, tenants and leaseholders, and prohibition of lettings and management agent fees; to enable local authorities to administer and enforce the scheme; to require that tenants, landlords and leaseholders have written agreements; and to empower local authorities, either alone or in partnership, to trade as letting and managing agents.”

Sir Alan Meale’s Bill, entitled “The Private Landlords and Letting and Managing Agents (Regulation) Bill 2013-2014”, also sets out to regulate all private landlords.

Its objectives are:

  • To establish a mandatory national register of private landlords
  • To introduce regulation of private sector lettings agents and managing agents
  • To establish a body to administer the national register and to monitor compliance with regulations applying to lettings agents and managing agents
  • To require all tenancy agreements entered into with private landlords to take the form of written agreements.”

Writing in Central Lobby, a political newsletter, Mr Healey said: “Politicians haven’t got to grips with the problems that private renting brings. There’s more consumer protection when we buy a fridge or hire a car than when we rent a home. And there’s a growing problem with housing market middlemen who answer to no-one – letting and managing agents. The Royal Institute of Chartered Surveyors (RICS) has called this sector the property industry’s ‘wild west’. The majority of private tenancies are let through agencies, yet absolutely anyone can set up as a lettings or managing agent. Unlike even estate agents, there is no system of licensing or standards, while tenants have no legal right to a written tenancy contract and are often hit by huge and hidden upfront fees. Landlords also report letting and managing agents failing to provide the services expected or hitting them with hidden and excessive charges. The worst drag down the reputation of the rest, which is why many of the legal changes I propose are backed by the associations that represent letting agents, managing agents and landlords as well as by MPs from all parties. So there’s a wide recognition that self-regulation has failed and legal regulation is required to improve choice, competition and standards. And people rightly now look to Parliament to make this market better for the millions who have no other option but a private rented home.”

The new proposals have angered landlords, who already have to comply with over 200 individual pieces of legislation, in order to operate a rental property business.

Dave Lawrence, a private landlord in Salford said “The proposals are set out to give the Government an in-road to the profits that private sector landlords are currently enjoying. There is an underlying factor to both of these new proposals that will provide the Government with some form of autonomous control rather than being about getting landlords to provide a good quality service. The coalition Government have been set on tapping into the private rental market since they came to power because they know that there is money in it. I am generally in favour of better regulation, however when you stop to consider that the Government also want us landlords to be unpaid agents for the UK Border Agency, policing illegal immigrants and the fact that they are pushing to further control private rental sector (PRS) landlords does not bode well in my book.”

Both bills are due to have second readings in October.

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