Government Guidance to the Tenant Fees Act, with a side of #EndSection21
Not long now until the Tenant Fees Act finally takes effect on 1st June. More details of the fees ban were included in our January e-news. Now, government published formal guidance to the Tenant Fees Act. The guidance states that
A landlord cannot evict you using the section 21 eviction procedure until they have repaid any unlawfully charged fees or returned an unlawfully retained holding deposit.
For avoidance of doubt, p.4 of the guidance goes on to say that
All other rules around the application of the section 21 evictions procedure will continue to apply.
But less than two weeks later, Government announced plans to abolish so-called ‘no fault’ evictions. All of us engaged in the campaign to End Section 21, spearheaded by Generation Rent, were so delighted by this news that we downed tools to party. On a Monday. And a good time was had by all.
As the statement from Ministry of Housing, Communities and Local Government stated, this heralds the “biggest change to private rental sector in a generation.” One which promises to “bring peace of mind to millions of families while providing certainty to responsible landlords by creating a secure rental market in which to remain and invest“.But details emerged on Tuesday 23rd April, when Heather Wheeler, the Parliamentary Under-Secretary of State at the Ministry of Housing, Communities and Local Government, answered a question from Bob Blackman MP.
For a number of reasons, firmly rooted in the experiences of renters we know, Renters’ Rights London is badly disappointed by what is now being proposed. Do click on the link, above, and watch the (very short) video clip. We need to know what you think of the changes outlined by Heather Wheeler.
How closely does this meet the outcome you expected when you learnt about plans to abolish section 21 evictions? What changes would you really like to see? If there is to be a consultation, we need to submit an informed response.
And here’s the Guidance to the Tenants Fees Act 2019
Making accurate assessments of the affordability of renting is complex but put we all know that renting is costly. Across London and the South East, affordability peaked in 2015, at 45% of net earnings, according to Michael Lloyd, writing for mortgageintroducer.com. In March 2019, the average rent for a home in Greater London rose to £1,737 pcm, the highest level on record. We fear that, if landlords remain free to raise rents every year or two, when section 21 is finally abolished, we are highly likely to be forced out by unaffordable costs.
To help make a strong case for rent controls, Renters’ Rights London recently conducted a survey on affordability. If you contributed a response, thank you very much indeed.
Results from more than 50 renters in 13 London boroughs revealed that we pay an average of 52% of earnings on rent alone each month. No-one pays less than 29% of earnings on rent and actually, that low figure is misleading. It relates to a South London renter who works two jobs, one of which is a contract with no fixed hours. This renter has paid between 29% and 120% of monthly earnings towards a flat shared with two others across the past 12 months.
Overall, the survey results make very grim reading. On average, respondents pay 52% of wages to meet their liability for rent alone. This month, Renters’ Rights London has met a renter, working 48 hours a week, who pays a frightening 90% of his earnings to sleep on a sofa-bed in the one bedroom flat he shares with his teenage daughter. We’ve met another renter who pays 70% of his earnings for a large room in a house in multiple occupation. Both are EU citizens but neither of the two satisfies the requirements to claim Local Housing Allowance at the moment.
Housing benefit/local housing allowance cost 2.9% of total UK public spending in 2018-19. Paul Johnson, Director of The Institute of Fiscal Studies, recently described the fact of £22 billion paid on housing benefit as “the very expensive canary in the coalmine“. He upholds that the solution is to address the underlying problems of high rents, high house prices and inadequate social housing. We agree.
Renters’ Rights London will continue working to make the case for rent controls in London. Towards that end, we have re-opened the ‘affordability’ survey. Because we’ve already posted this fact on Facebook, we have had a good number of new responses already. Still, we need many more renters to contribute. The survey is entirely anonymous and takes only 5 minutes to complete. It will stay open for another four weeks.
Please help Renters’ Rights London to make the strongest possible case for rent controls in the capital >> https://www.rentersrightslondon.org/take-action/affordability-rent-controls/
Shared tenancies (again) and failure to return a deposit
Nuzhat was shocked to receive a letter before action from her ex. The two had taken out a joint tenancy for a year, in February 2018. The deposit was protected, in line with the law. Nuzhat was named as ‘lead tenant’ with the deposit protection scheme.
But living together had proven to be extremely difficult. By June, they had fallen out, badly. A week before the rent for July was due, Nuzhat arrived home from work to find that Sara had moved out. She had also blocked Nuzhat from calling her.
A couple of days later, Nuzhat wrote to the landlord’s agent to explain why the rent might be late. They were were sympathetic but there was no break clause in the tenancy agreement. Both Nuzhat and the agent asked the property owner to permit surrender of the tenancy. But the property owner refused.
For the next eight months, Nuzhat had to pay the whole rent herself. It was a real struggle. This is a risk you take when you enter into any joint tenancy. The same total rent is due even after one person has reneged on the agreement. Still, across time, she learnt that she liked living alone and in February 2019, Nuzhat renewed her tenancy for a further six months. Then, Sara’s letter before action arrived.
Dear Ms. N. S.,
Letter before action: Failure to return my deposit
I am the former assured shorthold tenant of the above address. My tenancy started on 1st February 2018. I left the property in good order and the rent was fully paid to the end of my tenancy.
I am writing concerning the deposit of £580 I paid to you on 25th January 2018. as a security against my obligations under the terms of my tenancy agreement.
I am writing to request that you refund the full amount of my deposit to me within 14 days. If I do not receive payment or a substantial response from you by I will issue court proceedings in the county court without further notice.
I reserve the right to include a claim for interest on the amount of the unreturned deposit.
I will also be asking for an order to cover my costs. I will be relying on court rules for pre-action conduct that say you may have to pay more in costs if you ignore this letter.
This kind of letter before action is most usually sent to an agent or landlord who has failed to return a deposit within ten days of a written request for it, after the end of a tenancy. Nuzhat was shaken by the letter and contacted Renters’ Rights London.We were well pleased to learn that Sara had reappeared. Now, Nuzhat had a correspondence address for Sara.
Because she had abandoned the tenancy, and her obligation to pay rent every month for twelve months, Sara could not be entitled to the deposit back. The deposit was a sum equal to her share of one months rent. But even after that, Sara still owed seven months rent. And because Nuzhat had been in correspondence with both the agent and the property owner, she could prove it.
.…Even though the way she made contact was stupid under the circumstances, deep down inside, Nuzhat is relieved to learn that Sara is definitely safe and well. Sara is equally relieved to know that Nuzhat managed to pay the rent on her own. But Sara is really scared. She still owes all that money. Sara telephones Nuzhat to talk it through. During that conversation, both agree that living together was a bad idea, although they shared some good times, too. But as they are both much happier now, anyway, they are not angry anymore. Sara offers to sell her car and pay back £2500 of what she owes as soon as possible. Nuzhat accepts; it’s better than nothing and she doesn’t really want the hassle of a court case, anyway. We’re Londoners so it’s not quite a Hollywood ending.