And other changes to residential tenancy agreements
Announcing an overhaul of the government’s model tenancy contracts last month, the Housing Secretary called on landlords to make it easier for responsible tenants to have well-behaved pets in their homes. As more and more young people and families are forced into long-term renting, the government says its mission is to improve life for tenants.
Currently only around 7% of landlords advertise homes as suitable for pets, so many people struggle to find a home suitable for themselves and their pets and some are forced to give up their pets altogether.
The Model Agreement for an Assured Shorthold Tenancy is the government’s recommended contract for landlords to use when signing up new tenants for properties in England. It sets out the minimum requirements although it can be altered by landlords to cater for specific circumstances, tenants or properties.
At the moment, the model contract says that tenants must not keep any pets at a property without the prior written consent of the landlord, although the guidance notes discourage landlords from operating a blanket pet ban, requiring them to turn down requests only ‘with good reason’. A revised model tenancy agreement will be published later this year, removing restrictions on well-behaved pets.
The government believes that responsible pet owners should not be penalised. It says that landlords’ properties should be protected from damage by badly behaved pets but total bans on renters with pets should only be implemented where there is good reason, such as in smaller properties or flats where owning a pet could be impractical.
It’s a fine balance: some landlords believe that the choice of tenant for a privately owned property should be exclusively the owner’s, without interference from government and that encouraging a significant increase in pets will cause more wear and tear to properties, at a time when landlords have been forced to reduce tenant deposits.
Interestingly, when the tenancy deposit cap was introduced last year (see our publication Landlords and agents: What you need to know), the RSPCA and Cats Protection charity voiced fears that the cap would reduce tenants’ flexibility to provide a higher deposit to cover pet damage.
Other changes to look out for in 2020
Reminder about EPCs and the Minimum Energy Efficiency Standard (‘MEES’)
Energy efficiency rules will be extended to all existing tenancies from 1 April this year. Properties with an EPC rating of F or G cannot continue to be rented out from that date, unless the landlord has registered one of the permitted exemptions, if available. For more details about exemptions, please see Landlords must contribute up to £3,500 to improve energy efficiency.
Landlords who fail to comply with MEES risk fines up to a maximum of £4,000 depending on the length of the breach.
Electrical checks/new deal for renters/lifetime deposits
The Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020 were laid before Parliament in January and are expected to become law on 1 June this year. They will apply to new tenancies from 1 July 2020 and existing tenancies from 1 April 2021.
Landlords and letting agents will need to ensure that electrical installations in the majority of privately rented properties are tested regularly and an electrical safety report sent to the tenant within 28 days. If remedial work is required, the landlord must carry it out within 28 days (or sooner, if indicated by the report). Local authorities will be responsible for enforcement, with powers to impose fines up to £30,000.
Early action by landlords is recommended, as there may be a shortage of qualified engineers closer to the deadlines.
New deal for renters
The government unveiled a ‘revolutionary new deal for renters’ in the Queen’s Speech in December 2019, promising to restore fairness, honesty and transparency to the heart of the housing market.
The most controversial proposal is the abolition of Section 21 ‘no-fault evictions’ (for more information, please refer to our publication Abolition of ASTs: the end of an era).
Lifetime deposit system
The government’s plans include the introduction of a ‘lifetime deposit’ which can be moved from property to property, replacing the current system of individual deposits, which requires tenants to raise a new deposit when moving before the old one has been returned to them.
The Conservative party manifesto was light on the details of how the proposal would work in practice. A Tenancy Deposit Protection Reform Working Group has been set up to look at ways of streamlining lifetime deposits within the existing tenancy deposit protection system and to address various issues. For example –
1. What will happen if the existing landlord uses an insurance-backed scheme and the new landlord uses a custodial version?
2. What will happen when deductions for damage need to be made from a tenant’s deposit? Will the existing landlord need to pass on the full deposit before receiving the funds they require for repairs, or will the new landlord receive a deposit lower than the value they agreed with the tenant, with the tenant making up the shortfall?
Renters’ Reform Bill
The proposals for lifetime deposits are part of the wider Renters’ Reform Bill for England which is intended to ‘update the relationship between tenants and landlords’.
As yet, no date has been set by the government for the Bill’s second reading. Progress is likely to take some time if the Tenant Fees Act is anything to go by: that Bill was first mooted in November 2016 and only came into force in June 2019.
However, the law on pets is not part of the Renters’ Reform Bill and private landlords will be free to continue imposing blanket bans, at the risk of losing potential tenants to more pet-friendly landlords. The proposal may lead landlords to charge higher rents to tenants with pets, to cover potential damage.
Asking previous landlords for references about pet behaviour, as well as tenant behaviour, may become the new norm!
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