Eric Pickles to announce ‘Tenants Charter’ Plans

Over the past few years the number of people that rent properties instead of buying them has increased rapidly as many people throughout the UK can no longer afford to save for a deposit for a mortgage. Since the start of the recession the cost of living has increased while wages have remained mainly stagnant, meaning that the prospect of saving enough money for a mortgage is unachievable for many.

In order to combat this issue the government has introduced a number of schemes such as Help to Buy which is designed to get more people buying properties instead of relying on the private rental sector. However, even though these schemes have been marginally successful there have been criticisms, mainly because there is still only a small minority of people who are benefitting from them.

As private rented accommodation is the first or only option for most people living in the UK, the government has looked into ways to improve the standards of this type of accommodation as well as the sector itself. Landlord registration has already been introduced by many local councils in a bid to reduce the amount of rogue landlords who provide sub-standard housing for unfair amounts of rent and improve the quality of life for thousands of households throughout the UK.

However, even landlords that provide good quality housing at fair prices may soon have new legislation placed upon them by the government as they are now planning on bringing in a ‘tenants charter’ which will force landlords to offer longer tenancies. The argument for this charter is that as so many people now rely on private rented accommodation they should be given longer tenancies so that they have the security they need when it comes to their homes.

The communities secretary Eric Pickles is expected to make his official announcement later today where he will say: “The last thing we want to do is hurt hard-working tenants by increasing costs and strangling the sector with red tape. But families deserve stability for their children. Today’s proposals will raise the quality and choice of rental accommodation, root out the cowboys and rogue operators in the sector, and give tenants the confidence to request longer fixed-term family-friendly tenancies.”

Naturally, landlords have already started to voice their concerns over the plans, especially as some believe that even with a comprehensive landlord insurance policy the charter will reduce the rights they have over what is technically their properties and hand them over to their tenants. Furthermore, as a stipulation of granting a mortgage many lenders require landlords to offer tenancies no longer than six or twelve months, which could lead to the amount of landlords looking to expand their portfolio reducing in the near future.

One landlord wrote an article on stating that the main reason that landlords and banks prefer fixed term tenancies of between six and twelve months is because if a tenant defaults on a payment it is extremely difficult to arrange an eviction. Mark Alexander added: “Theoretically a landlord can apply to obtain possession by serving two weeks notice once a tenant is two or [more] months in arrears on rent. However, after that 10 weeks has expired it can take several months to get a Court date.”

“Even when a possession order has been granted it then takes several more weeks before bailiffs can be appointed to enforce the order. If you want landlords and mortgage lenders to provide greater security of tenure to tenants then you are going to have to sort out the possession rules for landlords first.”

There have also been criticisms from the housing charity Shelter, however they claim that Mr Pickle’s charter will not go far enough. A spokesman for the charity said: “There are lots of noises in the right direction but no real commitment to make this happen in practice. With the market showing the pressure of fast rising demand, renters must have real power to genuinely choose one type of tenancy over another.”

If the tenants charter goes ahead tenants will soon have the right to ask for their landlords to provide a longer rental agreement of between two and five years which the landlord will then be obliged to provide. The consequences of this type of legislation could be extremely detrimental to the private rental sector, which ultimately could make it harder for tenants to find affordable private rented accommodation across the country.

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