You have probably heard about the Government’s White Paper on Levelling Up, and the Renters’ Reform Bill, which has been drawn up to ensure all private landlords adhere to a legally binding standard to provide decent housing. When this bill is passed, probably later this year, it will be a major shake-up in the rental arena and will introduce the abolishment of Section 21 notices and a new Ombudsman so that disputes can be settled quickly and cheaply without going to court.
In addition, landlords will no longer be able to set bans on families with children or those in receipt of benefits, and they should be more open to pet ownership amongst tenants. Reforms will also include notice periods for rent increases doubling and tenants will have stronger powers to challenge unjustified hikes.
(Picture taken from one of our listings on Bedfordshire Way)
But it’s not all doom and gloom for Landlords. Of course, the Government wants to support the many responsible landlords who provide quality homes to their tenants. This White Paper sets out their commitment to strengthen the grounds for possession where there is good reason for the landlord to take the property back. And together, these reforms will help to ease the financial burden on renters, reducing moving costs and emergency repair bills. It is hoped it will reset the tenant-landlord relationship by making sure that complaints are acted upon and resolved quickly.
With so many changes afoot, as a buy-to-let investor you may feel confused, but with rental demand remaining strong, we still see there is good potential to sustain or boost returns.
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What Else is New?
Energy efficiency rule changes are on the way…
Also on the Government’s radar is improving energy efficiency. At the moment, rental properties must have an EPC with a rating of E or above. New rules are being introduced by 2025, stating that all new tenancies must have a rating of C or above, and existing tenancies will follow suit in 2028.
The capped amount landlords must invest to achieve these improved ratings, will go up from £3,500 to £10,000. It is estimated that many privately rented homes currently have an EPC rating below C, meaning landlords will need to carry out upgrades in the very near future.
What help is available?
With an estimated 50% of rented homes nationwide requiring upgrades in order to meet this target, some landlords will struggle to meet the costs.
The government has announced the £1bn ECO Plus scheme for homeowners who may be able to claim a grant of up to £1,500 to enable them to insulate their homes better.
The scheme, launching in April, will run until 2026 and could help some landlords who meet certain criteria.
Find out more about Energy Performance Certificates here
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