Rugg Report
With almost 2.6 million homes in England being rented from over half a million private landlords, In January 2008 Yvette Cooper commissioned an independent review to look at what problems tenants and landlords face and what works well in the sector.
OCT 2009 Julie Rugg and David Rhodes from the Centre for Housing Policy at York University headed the review and have now published their findings
The review looked at a range of issues including the professionalism of landlords, the quality of properties, and problems in private renting.
Recommendations include.
Introducing a light touch licensing system for landlords and mandatory regulation for letting agencies. The 2004 Housing Act did implement legislation with regard a person being "fit and proper" such an extension of this licensing may see an individual losing their right to manage or Let property. Such a scheme would impose a mandatory licence with a permit fee and act like a driving licence - with points being deducted. At present ALL landlords in Scotland require a licence.
Introducing a new independent complaints and redress procedure for consumers, to help end long drawn out disputes. This would be financed by licence fees.
Tax changes to encourage good landlords to grow, including changes to stamp duty to encourage them to buy more properties. The report does highlight the need for the Government to encourage landlords to grow the business of letting and for landlords to consider it as a business. Also in favour of tax relief on improvements to provide incentive to modernise property.
Looking at ways for the PRS to be more accommodating towards households on lower incomes, including considering more support for landlords prepared to house more vulnerable people. The inference of the report appears to be that tenants should have a choice between private and Social Housing. At present this is price prohibitive and the security of tenure less favourable than Social Housing. This probably explains the reference to the Law Commissions desire to increase the minimum term of an AST from its present 6 months. The only way such social inclusion will arise is if Local Housing Allowances rise. Possibly re-introduce the Rental Deposit Assistance from the Social fund that was abolished in 1988. This Social Freedom of choice is referred to as 'Equalising Rental Choice' in the report.
Local authorities taking steps to better understand the sector and support good landlords whilst tackling poorly performing landlords and promoting tenants' rights. If a licence is introduced the council will have the power to issue points against the licence. Such a system would see many councils lose their licences - but no doubt the social rented sector would be exempt from such scrutiny. [as like other rules]. The Report rightly highlight that tenant satisfaction is higher in the Private Rented Sector than in the social rented sector.
A possible MOT 'Home Condition Certificate' for properties payable by the Landlord.
Raising the ceiling on the current AST from £25,000. Which would bring more properties under the control of the Housing ACT including Deposit Legislation. We may also see more consumer friendly ASTs that include clauses such as those included in the
pims.co.ukTenancy Agreements
- The AST Ceiling increase has now been implement - With effect from 1 October 2010, The Assured Tenancies (Amendment)(England) Order 2010 (SI 2010/908) increases the high rent threshold from £25,000 to £100,000. read more
There are many inferences as to the influence institutional investors could play. With the correct tax breaks for the likes of pension funds, they will be encouraged to enter the market.
The Government will now carefully consider the recommendations before deciding next steps.
The report is very well produced and can be viewed
here note this report is a PDF and 178 pages.
NOTE IT IS A 4,2 Megabyte file (so big)
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IMPORTANT - Landlords & Letting Agents in Wales, it is intended the Wales Housing Act be introduced over the course of 2015 and 2016. The requirement for landlords and agents to register and become licensed is expected to come into force in autumn 2015. Read More
Update 16th May 2009 - Following the Rugg report and no doubt after reviewing the licencing schemes in Scotland. Plans to introduce a National Register for all landlords were announced this week by Housing minister Iain Wright.