Assetz® News - Rental market prepares for big changes

Rental market prepares for big changes

10th February 2006 |

With the Housing Act and the Disability Discrimination Act both making new demands this year, 2006 is likely to be an extremely important year for those in the rental market.

The new regulations are going to affect landlords, buy-to-let investors and property management companies in the private sector, according to the Association of Residential Letting Agents (ARLA).

At the ARLA annual conference last week, delegates were told that there would be serious repercussions for those found to be neglecting the requirements, while officials from the Chartered Institute of Environmental Health and the Disability Rights Commission encouraged property experts to rise to the challenge.

One of the key amendments is that there has been a redefinition of houses in multiple occupation (HMOs), with HMOs now subject to mandatory licensing. This will generally refer to shared houses and typical student properties, according to the ARLA, with bedsits also affected by the readjustment.

With a view to adding confidence to the industry and discouraging underhand business operations, personal checks will now take place on landlords and property managers, with a failure to meet the set standards leading to severe penalties.

For the most serious crimes, including failing to get a licence and breaching rules on the number of tenants, landlords may have fork out as much as £20,000.

The new laws will also be clamping down on landlords prone to taking short cuts, with the Housing Health and Safety Rating System (HHSRS) monitoring a range of housing standards. While obvious things to look out for include danger of explosion or structural collapse, less obvious hazards include glass panels at the bottom of stairs.

The basic idea behind HHSRS is that it is based on the risk to the potential occupant who is most vulnerable to a particular hazard, meaning that stairs will be considered in relation to the elderly and low temperatures will be gauged in relation to very young children.

Andrew Griffiths, principal policy officer for the Chartered Institute of Environmental Health, warned attendants at the ARLA conference that the laws governing houses in multiple occupation and housing health and safety come into effect on April 6th, meaning there is not a huge amount of time left for those who have failed to comply in advance.

The Disability Discrimination Act, on the other hand, will only come into effect in December, but landlords have been advised that it is crucial to begin preparations at an early stage.

"Landlords and letting agents cannot refuse a tenant because of disability and may have to make changes to their rental practices and to provide auxiliary services," said Simon Pickering, practice development officer for the Disability Rights Commission.

"For example, a copy of the tenancy agreement with large print should be made available for somebody who is partially sighted or a no pets rule should be waived for a guide dog or any other type of assistance dog," he added.

With the penalties so serious and stringently enforced, property investors have been warned that it is now more important than ever to seek professional advice and guidance before looking for a buy-to-let mortgage.