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Published on : March 1, 2022 15:26

The Future Of Lettings Legislation – What Does It Hold?


Staying compliant when letting a property is crucial to avoiding fines, having your property repossessed, or even potentially facing time behind bars. The ever-shifting legislative landscape promises a number of key legislation changes not only in the coming weeks and months, but the next decade.


For landlords who are committed to remaining compliant and on top of legislative changes, the coming months certainly promise to keep them on their toes.

In line with the Government’s plan to implement a digital system for Right-To-Rent check reviews, the current temporary measures surrounding these checks was initially set to end in Spring.

These checks have seen agents adjust to the COVID-19 pandemic and allow tenants to submit digital copies of documentation to prove their right to rent, as opposed to needing to supply physical proof.

However, the deadline date for these checks has now been pushed back until September 30, giving agents and landlords more time to implement measures for the Government’s plan to implement digital systems.

This will mean that as part of the new Right-To-Rent checks, landlords and agents will no longer be able to check biometric residence cards or permits manually, and prospective tenants will be required to prove their right to rent using a shareable code (a system already in use in Switzerland). Agents and landlords will be able to check these codes online.

passports
Physical copies of documentation such as passwords will not be required for much longer.

The next major change will occur in July, but will primarily impact the lettings market in Wales. Tenancies will become ‘occupational contracts’ and tenants will become ‘contract holders’.

Landlords will need to give their tenants six months’ notice on no-fault evictions, which cannot be served until the first six months of the new tenancy has passed. This means that from the moment a tenant(s) move into a rental property, a landlord will not be able to remove them under no-fault guidelines for one year.

There are also changes to joint contract holders’ rights, as well as the introduction of succession rights for contract holders, meaning the contract can be passed onto a successor such as the previous occupier’s children, whether they can afford to take over the tenancy or not. Whilst these laws are currently only set to be effective in Wales, it is unknown whether or not the rest of the UK will see anything equivalent. Looking further ahead in 2024, landlords will be impacted by the Making Tax Digital scheme.

All landlords with an annual turnover of £10,000 and above will be required to submit digital tax returns under the new rules, as part of government plans to make it easier for individuals and businesses to get their taxes right.

This will include quarterly financial updates and an end-of-year report declaring any reliefs or allowances. This will become mandatory on 6 April 2024, giving landlords and letting agents plenty of notice in order to plan ahead.

Further down the line, April 2025 sees the next phase of changes to the Minimum Energy Efficiency Standards with a minimum rating of EPC C for all new tenancies.

EPC certificates explained - Which?

Existing tenancies will have until 2028 to comply. These changes will ensure energy-efficient homes and assist in meeting the government’s net-carbon zero targets.

Between now and 2030 we will also start to see the impact of the Levelling Up legislation being introduced in England, much of which is yet to be revealed.

There are also the recommendations made by the Regulation of Property Agents working group, which suggests a single, mandatory and legally enforceable Code of Practice for managing property agents. It also suggests a system with minimum entry requirements and a continual professional development model for property agents, and clarifying processes and charges for leaseholders.

As with any legislation changes, it is always beneficial to pay close attention to the detail and look to implement any required changes as early as possible, in order to have peace of mind when compliance is required.

Making these preparations, and even staying up to date with the legislative changes itself, can be vastly time-consuming. If you are a landlord looking for a passive income on your rental properties, then it will ultimately be beneficial to have the assistance of an effective managing agent.

An agent that is able to not only stay ahead of the curve when it comes to legislation by being part of a regulatory body, but also able to proactively advise you of any impact this will have on your portfolio and how to make these changes. This keeps you compliant, your tenants safe, and protects your rental income.

For more information about how our property management services can help take back control of your time, whilst keeping you compliant, give us a call on 0161 826 6756 or click here to leave your details and a member of the team will reach out to you.

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