The Renters’ Rights Bill

LegalforLandlords Group CEO Sim Sekhon didn’t mince words when talking about the reforms affecting the property rental sector and advised that landlords must ensure they focus on letting to ‘quality’ tenants.

Sekhon spoke after a landlord event in Bristol where the Renters’ Rights Bill dominated discussion. Landlords he spoke to are concerned it will erode their rights, are frustrated the government is pushing ahead despite court delays and bailiff shortages, and are worried about potential new taxes in the upcoming budget.

Unsettling time

Without a doubt it is an unsettling time, but Sekhon is surprisingly pragmatic, pointing out that some issues are beyond the control of the individual. And in such cases, he believes the best approach is to have a clear, rational plan.

He told us that in a climate of rising arrears, landlords are becoming more selective in their tenant choices, but stressed that careful scrutiny, going forwards, needs to be the landlords’ default approach. He went on to discuss provisions within the Renters’ Rights Bill which increase the rent arrears threshold from two to three months and increase notice periods. He stressed, “Rents have risen, and the stakes are higher. You simply cannot risk agreeing to a tenancy without thorough referencing. Review the information provided carefully and, wherever possible, meet with the potential tenant.”

Rent and Legal protection

It is, of course, possible to protect your interests with Rent and Legal protection insurance. Sekhon told us that around 16% of new let instructions are now covered by such policies and that he anticipates that figure will soon double. It’s an indicator of the market, income levels and the time it can take to gain possession when a tenant defaults.

Do your homework

We asked Sekhon whether he would advise landlords who currently self-manage to switch to working with an agent. He said that the move could be beneficial but only if the agent was reputable. “Do your homework,” he said. “Find the agent who’s fully conversant with the regulatory and EPC changes, who understands your investment, the importance of yield and long-term capital appreciation.”

Although the Renters’ Rights Bill may take months to become law, it’s already affecting the market. Landlords are becoming more cautious, requiring higher affordability and stronger job security from tenants, making it even harder for those already struggling to secure a rental.