Some news items for you on a Friday

Sharp rise in complaints in annual report of Property Redress Scheme

The Property Redress Scheme (PRS) released their annual report this week, revealing that there has been a 27% rise of formal complaints against PRS members. The PRS, for those who do not know, is a government backed redress scheme for Landlords and letting agents. While for landlords, being part of a redress scheme is not mandatory, it is for letting agents.

While some of this rise can be attributed to a rise in membership, this rise might also be in part of the covid pandemic causing landlords and letting agents to let their standards drop. However, the head of the property redress scheme, Sean Hooker said: ‘considering the difficult year that consumers and property professionals have faced, I am encouraged by the fact that only a small percentage of our membership experienced a complaint against them’. Hooker also believes that the newly introduced tenancy mediation service they now offer will be able to keep tenants in homes.

Read the report found here

English Housing survey reveals that majority of tenants were happy with landlord and letting agent service

The English Housing survey was released for the 2019/20 year, revealing that 83% of private renting tenants were satisfied with their current accommodation. This figure has been consistent for the best part of a decade but it is important to reflect with the pandemic in mind.

During a very tough year for tenants and landlords, the high level of private renting satisfaction by tenants is indicative of the sacrifices that many landlords have made in order to keep tenants in the property. In the NRLA state of the sector report around 34% of respondent landlords said that there rental income had been negatively affected by the pandemic, a significant portion of this would through rent arrears so this is an issue effecting a lot of landlords. The fact that even with this loss, landlords were still able to keep a high quality service for the majority of tenants speaks volumes of the sector and of landlords as a whole.

Government setting up a feasibility study on an England database for landlords

This week the Ministry for Housing, Communities and Local Government revealed that it is setting up a feasibility study to investigate if a national landlord database could be implemented into England.

Currently, the Government has limited information on landlords, often relying on local authority databases. This can cause issues such as rogue landlords as well as ignorant landlords to be able to function as landlords while not adhering to regulations or legislation. A database with all national landlords would mean that it would be a lot easier for the local authority or the government to be able to track down landlords who are not complying with the various aspects of being a landlord (such as HMO licensing and Safety regulations).

A national database has been in place in Wales since the enactment of the Housing (Wales) Act in 2014. In Wales, all landlords must register with Rent Smart Wales if they would like to let their property as well as go through mandatory training if they would like to manage the property.

While this does not automatically mean that a landlord database will be in place anytime soon, this can be seen as a statement of intent by the government that they are looking at a database as another enforcement tool against landlords who are not complying with the regulations.

Government figures reveal that rent is falling in real terms… but is that the full story?

Government figures have revealed that private rent was risen 1.2% from June 2020-21. However, this is below the inflation of housing costs, which rose 2.4% meaning that income that landlords are generating has decreased.

Within the Private Rented Sector, rent grew just 1.1% in England and 1.5% in Wales during the past year. While these figures should be taken with a pinch of salt as they can be attributed to the covid pandemic with landlords often being unable or unwilling to increase rent, it could also be shown to be indicative of the private rented sector as a whole.

However, with that being said, Letting agency Hampton this week revealed that their data showed that rent rose 8.5% last year with four out of the ten fastest months for rental growth over the last decade have been since the start of the pandemic. So although the government statistics are looking gloomy, there is some evidence that the private rented sector is being revived.

So what is the truth?

In the Newsround 200, we discussed a report which examined the lower end of the private rented sector. In the report, it discussed the reasons why landlords are leaving the housing benefit market – although some of the issues can be applied to the entire property market. Regulatory burden for landlords meaning that the law is more complicated as well as a perceived harsher environment for landlords has caused some to leave the industry. It can be argued that it is these burdens for landlords which are causing the greatest loss of income for landlords, rather than rent. In the Hampton study also, it was revealed that there is 46% fewer homes on the market than at the same time 2 years ago.

So with a significant amount of landlords leaving the sector, demand is growing with the supply decreasing, meaning that landlords can charge an increased rent on their property. However, this may not counteract the increasing expenditure for some landlords in making sure their houses compliant with the regulations that have come through in the past decade. So while rent will continue to rise, income gained by landlords may not rise proportionally.

Ben Beadle, chief executive of the National Residential Landlords Association had this to say about the report:

demand for privately rent homes continues to outstrip supply and without further efforts to meet that demand, rents will continue to rise. The government needs a strategy that properly recognises the importance of a thriving private rented sector in which tenants have genuine choices over where they rent.

The Hampton Letting Agency article can be found here

Government article can be found here

Snippets

• Welsh Government offering Fire Safety Review on Large Multi-Occupied buildings.
• Mayor of London Sadiq Khan providing funds for boroughs to buy back ‘Righty to buy’ properties.
• John Lewis creating 10,000 houses over the next decade to address housing shortage problem.

Newsround will be back next week