Monday, 22 September 2008

Encouraging Responsible Letting

A couple of weeks ago we published details and links about the Law Commission’s report Housing: Encouraging Responsible Letting. We believe that everyone involved in the lettings industry should read this report as it is likely to form the basis for future legislation.

The report itself runs to 135 pages but according to the report only 40 landlords actually contributed. This probably reflects the research we have done which indicates that most landlords did not know that the Law Commission was preparing a report.

Some of the more interesting parts of the report are:

“The consequence of poor housing management and housing standards is that the private rented sector continues to suffer from a poorer reputation than it should, and some tenants continue to experience poorer housing conditions than they should.”

The Law Commission states “we think that bringing about effective change of culture in the residential lettings market may ultimately require the introduction of a compulsory system of self-regulation.

“Although the private rented sector is highly fragmented, with large numbers of individual landlords letting only a small number of properties, when aggregated together the private rented sector is an enormous business.”

“Few sectors of the consumer economy are wholly regulation free. Indeed what is remarkable is that the rental market lacks the structures for consumer protection found elsewhere”

The Law Commission makes a series of recommendations:

We recommend that landlord accreditation schemes should be made available in every local authority area.

We recommend the creation of a housing standards monitor for the private rented sector.

We recommend that consideration be given to making the Office for Tenants and Social Landlords the housing standards monitor for the private rented sector in England

We recommend the establishment of a rented accommodation stakeholder board to which representatives of all sides of the private residential rented property sector are appointed in each of England and Wales.

We recommend the development of a single code of housing management practice for landlords in each of England and Wales.

We recommend that the housing standards monitors and the stakeholder boards should be asked to consider the feasibility of the introduction of a national landlords’ registration scheme within their areas.

We recommend that all those who provide letting agency services on a commercial basis should be brought within an appropriate regulatory scheme.

We recommend that the monitors for standards and the stakeholder boards should be asked to develop proposals to encourage the development of alternative methods for dealing with complaints and grievances.

We recommend that the housing standards monitors and stakeholder boards should be asked to develop proposals for piloting a scheme for home condition certification.

We recommend that the housing standards monitors and stakeholder boards should be asked to consider what appropriate and affordable incentives would be necessary to ensure that the proposed programme for the enhancement of voluntary self-regulation is made attractive to landlords.

Interestingly, the Law Commission seems to agree with that there is no need to change the Section 21 notices. The Law Commission says:

Retaliatory eviction

Although this was not an issue on which we consulted, it is an issue which has attracted a considerable amount of public attention over the last year. The basic idea is that, where a landlord seeks possession against a tenant, but it can be shown that the proceedings were taken against the tenant in retaliation for the tenant making a complaint to or taking some other step against the landlord, for example resulting from poor housing conditions, the landlord would not be entitled to a possession order from a court.

At first sight, this form of legal protection for tenants may seem an attractive idea. We think, however, there are likely to be significant difficulties with it in practice.

(1) Most tenants do not seriously consider taking legal proceedings. The availability of legal provisions to address retaliatory eviction may be of symbolic importance but be of little practical effect.
(2) There would be major evidential problems in establishing that a landlord was bringing possession proceedings solely as retaliation for steps that have been taken against him or her.
(3) Retaliatory eviction does not fit the smart regulation approach we advocate here.
(4) We anticipate that introducing retaliatory eviction could cause considerable disturbance to the private rented sector by introducing a measure whose impact would be unpredictable and uncertain.”

However, we believe that the threat raised by the Citizens Advice Bureau and others remains very real and we ask everyone involved in the lettings industry to sign our Petition Against Changes to Section 21 Notices. Already over 2,100 people have added their names, but we believe that is essential that as many people as possible join with us and sign the Petition.