The mainstream media is very excited about the introduction of a „once-in-a-generation” reform of the law for private renters. Tenants (Amendment) Bill 2023 (The „Ra Chi Tu”) However, landlords need not panic — yet. Legally, the bill has only received its first reading in the Commons, and when it is put on the statute books – or even if it is – landowners will be given time to decide whether they want to remain private. Rental Department.
Below, we take a landlord’s view of what the new law means.
Good news for tenants but bad news for landlords A title change can cause landlords to lose a significant amount of control over their property. We are all used to it Assured Short Term Lease („AST”), allowed a landlord to let a property for a short period of up to six months after the initial contract period of the AST ended. The lessee complied with all the terms of the lease.
The AST gave the landlord the option to increase the rent every six months or rent the property higher to new tenants. . The fact that problem tenants could be easily removed was a positive for the landlord.
The bill proposes to abolish the widespread use of AST, and to bring its less popular sibling – Assured Tenant – out of the shadows. An assured tenancy can, in theory, be granted for a short initial period, but once it expires, it is replaced by a statutory assured tenancy, which can only be terminated on certain statutory grounds (which we discuss below.) Additional protection for tenants
This means that even if a landlord grants a six-month lease, the possession cannot be repossessed after the expiry of this six-month period. A lease shall be deemed to be a statutory term lease which shall be prescribed for the period of payment of rent. Thus, a tenant may have a term as short as one week, but not more than twenty-eight days or one calendar month. However, the length of the lease term is often irrelevant because due to the legal renewal of the lease, the landlord is parting with possession of the property for many, many years, which may not have been what he initially wanted.
Legitimate grounds for recovery of possession
The main talking point is about „ending no-fault discharges”. This is only partially correct. Current landlord grounds for terminating tenancies include that the landlord (or its mortgagee) wishes to sell the property, or if the landlord is an individual, they need the property with themselves or a member of their family. Such situations can occur even when the tenant is innocent and complies with its lease obligations.
Provisions for terminating tenants for breach of lease have been increased, at least in theory. These include failure to pay rent or breach of tenancy terms, including nuisance and anti-social behaviour. In practice, however, county court waiting times can slow down the landlord’s enforcement of rights, leaving an antisocial or defaulting tenant with huge arrears while waiting for a court date.
Some readers may recall the ossification of the private rental market prior to liberalization in 1988. Assured Leases Are Terrible”Rent Act Rent„; What’s different is that the landlord can charge the „market rent” of the assured tenant. Under the bill, the landlord can only increase the rent once a year, but must use the „Section 13” procedure to do so. This means that the rent review clause in the lease agreement has no effect. Meaning. The landlord must give a statutory notice, advise the tenant of the increase in rent, and has the right to refer the increase to the First Tier Tribunal. The First Tier Tribunal will be tasked with determining whether the increase is „marketable”. Much to the dismay of landlords, the draft bill now stands. , it appears that the tenant can nominate the rent to the tribunal once he receives the keys.
While the bill does not represent a return to old-fashioned rent control, the requirement to issue compliant rent increase notices each year could lead to increased administrative costs, along with potential tenants’ action to reduce or discourage rent increases. For Landlords and Agents.
Other changes, including mandatory registration of landowners in a central database and a new grievance redressal, are being mooted, but as they are not detailed in the bill, they may come later to the party. A comprehensive secondary legislation would be required.
Purpose built student accommodation
This will not cause any harm Ra Chi Thu.
Anyone buying a property with ancillary residential permits should keep a close eye on the bill’s progress to ensure they retain maximum control over their property. Six months after the new tenancy bill becomes law and a year before existing assured shorthold tenants are fully guaranteed – when the interim rules are in place – landlords would do well to be proactive to ensure they are not caught „sitting around”. Tenants”.
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