Adam Fleming & Emma Jenkins
With the Deregulation Act 2015 (“the Act”) receiving royal assent on 26th March 2015 the changes affecting landlords and letting agents regarding the renting of residential property have been widespread.
Whilst the new regulations will not be applied universally to all Assured Shorthold Tenancy Agreements (“AST”) until October 2018, the regulations will impact upon all ASTs entered into or explicitly renewed after 1st October 2015. For the purposes of this article, the term ‘old tenancies’ will be adopted when referring to ASTs entered into prior to 1st October 2015, albeit that they may have become periodic after this date and the term ‘new tenancies’ will be used to refer to tenancies entered into or explicitly renewed after 1st October 2015.
Whilst not intending to be a full breakdown of the Act, the purpose of this article is to summarise some of the key provisions which are most likely to impact upon landlords and letting agents.
Section 21 Notices
By and large the requirements concerning Section 21 Notices for old tenancies will remain unaltered. Landlords and agents would be ill advised to adopt the new notice or any of the procedures outlined below for such tenancies until October 2018; to do so simply goes to notify tenants of rights which they will not be afforded under their AST.
With regard to new tenancies the following restrictions are now in place:-
>> A section 21 Notice can only be served after four months from the originating tenancy have passed;
>> A notice served under Section 21(1)(b) will expire 6 months after the date of service and a notice served under Section 21(4) will expire 4 months from the date of service;
>> The new standard form must be used for all tenancies created on or after 1st October 2015. Landlords will be relieved to learn that the requirement for the notice to end on the last day of a period of a tenancy has been removed for new notices;
In addition to the existing tenancy deposit and licensing requirements, the Landlord / Agent must also be able to evidence that the following documents have been served on the tenant(s) prior to service of a Section 21 Notice:-
>> A valid gas safety certificate;
>> An energy performance certificate; and
>> The government’s how to rent guide (as in force at the time).
All new tenancies are now subject to provisions designed to prevent landlords faced with complaints about the condition of their property reacting by taking steps to remove the tenant(s).
Part 1 of the Housing Act 2004 sets out the guidelines for the Housing Health and Safety Rating System, centering around 29 hazard profiles which landlords and agents need to be aware of.
Environmental Health Officers (“EHO”) from the Local Authority now have a statutory right to inspect properties to assess the likelihood of an incident. If following their inspection they decide to serve an Improvement Notice or Emergency Remedial Action Notice then the Landlord will be prohibited from serving a S21 notice for 6 months from the date of service.
Similarly, in respect of new tenancies, if the tenant makes a written complaint (e mail and text messages included) about the condition of the property the Landlord must respond within 14 days setting out:
>> What they intend to do; and
>> The timescale for doing so.
A failure of a Landlord to respond appropriately, or to respond by serving a Section 21 Notice, could prompt the tenant into complaining to the local authority resulting in an Improvement Notice being served or emergency remedial action being undertaken.
The position in respect of any deposit taken is very much case specific and advice should be sought depending on the individual circumstances of each case. Essentially though Landlords who fail to comply with the statutory requirements will be in significant difficulty in regaining possession of a rented property, and may well have to return the deposit in full before being able to serve a S21 Notice. It is very important for Landlords to seek expert advice in relation to tenancy deposits.
Smoke and carbon monoxide alarms
From 1st October 2015 all tenanted properties must have a smoke alarm fitted on each storey which includes a room used or partly used as accommodation. Additionally Landlords must ensure that there is a carbon monoxide alarm fitted in any room that is used partly or wholly as living accommodation and also contains any appliance which burns, or is capable of burning, solid fuel. Landlords are required to test that alarms are working on the first day of any tenancy commencing on or after 1st October 2015. Compliance is key given that fines for not having so can be up to £5,000.00
Right to Rent
With the introduction of the Immigration Act 2014 seeking to ensure that tenants have a right to rent in the UK, Landlords and agents are now required to obtain appropriate identification documents from new tenants prior to providing accommodation. A failure to establish a statutory defence to the having not complied with the legislative requirements could result in enforcement action by way of a civil penalty notice; this currently standing at £1,000.00 for the first penalty and £3,000.00 per occupant for subsequent rented accommodation.