The press have this week been speculating that UK tenants will be given the legal right to opt for three year tenancies to allow for greater security in the property market.
According to the Sun, Communities Secretary James Brokenshire is backing calls to make three-year terms mandatory to provide people better protection when renting property.
Similar legislation was introduced in Scotland recently which ensured that tenancies were no longer fixed term and also gave tenants more rights to complain about unfair treatment. The Scottish legislation means that:
• Residential tenancies are open ended; meaning landlords cannot ask tenants to leave after six months.
• Rent increases can only be implemented once every 12 months and with at least three months’ notice. If the increase is deemed unfair by the tenant they can complain to a local rent officer who will investigate the case.
• If a tenant has lived in a property for longer than six months then the landlord is now required to give at least 84 days’ notice for them to leave, unless they have breached the terms of their tenancy.
• A notice to quit is no longer required and has been replaced by a simpler version, the notice to leave.
• A model tenancy agreement has been produced by the Scottish government as a template for landlords to adhere to when using tenancy agreements.
Whether the UK government is set to implement similar measures across the rest of the country remains unclear, but it appears likely that they will offer tenants the option to demand a three year agreement with the potential for an opt-out should they want to agree a shorter deal.
Campaigners argue that six or 12 month tenancy deals are insecure for tenants and leaves them vulnerable to eviction at short notice and even homelessness should they fail to find a suitable alternative in time.
Those opposed to the changes say that landlords would be left with inflexible deals that make it much more difficult to end tenancies with difficult or disruptive tenants.
Regardless of the pros or cons it seems likely that the changes will be adopted and that should shake things up considerably with roughly 80% of current tenancies covering periods of between six and 12 months. It is also likely to affect estate agents further with landlords less likely to require their help recruiting tenants.
Broadly speaking the majority of landlords will not be affected in a negative way considering that most prefer long-term secure tenants and that the majority increase rents in a fair and proportionate way.
Certainly the majority who operate ethical, above-board portfolios needn’t concern themselves too greatly with the potential for falling foul of the negatives of such a move with most attracting good tenants.
Shelter chief Polly Neate told the Sun: ‘The current renting system is a complete mess, with families teetering on the edge of blink-and-you-miss-it six-month contracts – barely enough time to set your broadband up, let alone see your kids through school.’
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