The government is readying a consultation aimed at finding out why buy to let landlords fail to offer longer tenancies.
Housing under-secretary Lord Bourne announced the move in response to a written question in the Lords.
Lord Roberts of Llandudno asked: “What assessment they have made of the costs and benefits of introducing five-year minimum contracts for rented accommodation, to provide greater security for families?”
Lord Bourne explained the government wanted to look at ways buy to let tenants can stay in their homes for longer.
“The government is committed to protecting the rights of tenants and giving them more security,” he said. “
“We will shortly be launching a consultation seeking views on the benefits and barriers to landlords offering longer tenancies in the private rented sector. This work will inform any next steps, including costs, of how we can support landlords to offer more secure tenancies.”
The consultation was last mentioned in Chancellor Phillip Hammond’s Autumn Budget 2017 when he hinted tax incentives might encourage landlords to let tenants stay in their rented homes for longer.
“The government will consult on the barriers to landlords offering longer, more secure tenancies to those tenants who want them,” he told MPs at the time.
Letting restrictions put in place by mortgage lenders are a perceived obstacle to landlords offering longer tenancy agreements.
But this is no longer the case, according to the now defunct Council of Mortgage Lenders, which was swallowed by UK Finance in July 2017.
At least a dozen lenders responsible for around half of buy to let borrowing will allow tenancies of up to 36 months.
And around half of Britain’s 5.6 million private rented homes have no mortgage, which means the landlord is free to set the terms of tenancy.
In order for landlords to feel confident about long fixed terms, the legal system for possessions needs to be fixed, as at the moment it takes far too long and is too difficult to get an eviction on grounds, which is why most landlords use section 21, even when very serious grounds exist.
This adds to the urban myth that landlords simply evict on a whim, whereas according to the English National Housing Survey 2015-16, 73% of tenants said they ended their last tenancy, while only 11% said their last landlord had ended the tenancy.
My tenants stay with me for 5 years on average and so far I have never had to ask a tenant to leave. However, I don’t usually do renewals, I normally just allow the tenancy to become statutory periodic.
While I don’t normally renew, I do enter into a deed of assurance with my tenants, which means I would pay them a specified sum of money if I were to serve notice on them before a specified time, provided they were adhering to the terms of the tenancy.
As with the input provided by “Holborn 1977 I am generally happy for tenants to remain in my properties for longer periods of time, however, legislators and those who are in place to administer same, need to provide Landlords with an effective and time efficient means to evict “rogue tenants”.
Unfortunately the relative MP’s – and their advisers – appear to think that there are only Rogue Landlords in existence and fail to comprehend the existence of Rogue and/or bad Tenants.
I would suggest that, when the consultation commences, Landlords do respond to it with their considered comments and/or experiences.
I have had experience of giving a 12 month tenancy – never again. The tenant paid the first month’s rent, then didnt pay again despite the fact that she was receiving housing benefit paid directly to her. The Council was requested to pay the housing benefit direct into our bank account, such request was refused on the basis that the tenant was entitled to have it paid to her,” how she used it or spent it was her concern only”.
It took the best part of a year to have the tenant evicted, and before she left, completely trashed the flat. I now only allow 6 months tenancy, and once the date has expired allow it to run on a month buy month basis, providing the tenant adheres to the tenancy agreement.