12 Pieces of Legislation All Landlords Should Know
Landlords’ purse strings have been squeezed by tax and regulatory changes over the last few years and more and more buy-to-let investors are opting to go it alone and manage the letting and management of their property themselves. There are around 170 pieces of legislation that govern the private rental sector and here are the 12 most important...
On top of the tax and regulatory changes over the last few years, landlords and the rest of the UK have had to endure multiple lockdown periods with furlough and other restrictions contributing to a detrimental effect on all incomes.
At the back end of 2019, self-management, the proportion of private landlords shunning letting agents in favour of letting and managing their own properties, increased to 43% according to a survey of the National Landlords Association (NLA) members. At the end of 2020, a survey by industry insurance provider, Hamilton Fraser, estimated this figure to be around 48%. It is now estimated to be around 51%.
If a landlord does choose to self-manage, then there is an enormous amount of regulation that they need to be aware of in detail. There are around 170 pieces of legislation that govern the private rental sector and detailed below are what we consider to be the most important:
- Consumer Protection Regulations
- Housing, Health and Safety Rating System
- Housing Act 1988/2004
- Immigration Act 2016
- Deregulation Act 2015
- General Data Protection Regulation (GDPR)
- Gas Safety Regulations
- Electrical Safety Regulations
- Deposit Registration Regulations
- Housing and Planning Act 2016
- Energy Efficiency Regulations 2015 and 2018
- Homes (Fit For Human Habitation) Act 2018
Please note this list is not exhaustive and we would recommend that you endeavour to keep up with any legislation changes moving forwards.
Consumer Protection Regulations
Consumer Protection Laws are extremely detailed and, if you have a few hours to kill, there is a 98 page document on the gov.uk website which explains it in great detail!
However, in essence, the legislation states that to comply with consumer law, agents and landlords must ensure that the services they provide to tenants are carried out with reasonable care and skill and within a reasonable time. This covers services prior to a tenant moving in, during the tenancy and after the tenant has moved out.
Housing, Health and Safety Rating System (HHSRS)
The HHSRS a risk-based evaluation tool to help local authorities identify and protect against potential risks and hazards to health and safety from any deficiencies identified in dwellings. It assesses 29 housing hazards and the effect that each may have on the health and safety of current or future occupants of the property. If a hazard is a serious and immediate risk to a person’s health and safety, this is known as a Category 1 hazard. If a hazard is less serious or less urgent, this is known as a Category 2 hazard.
A tenant can request an inspection of their home at any time to the local council.
The Housing Act 1988/2004
The Housing Act 1988 governs the law between landlords and tenants and specifically introduced the concepts of assured tenancy and assured shorthold tenancy.
The Housing Act 2004 significantly extends the regulation of houses in multiple occupation by requiring some HMOs to be licensed by local authorities. It also provides the legal framework for tenancy deposit schemes, which are intended to ensure good practice regarding deposits in assured shorthold tenancies and make dispute resolution relating to them easier.
Immigration Act 2016
This act introduced “right to rent” checks across England. All landlords providing tenancies in England are required to carry out these checks. The aim of the checks is to ensure that any person living in a rental property has the correct permissions to reside in the country.
Landlords in England face financial penalties and prosecution if they rent to someone who does not have a legal right to be in the UK.
Deregulation Act 2015
The Deregulation Act 2015 came into force on 1 October 2015 affecting both landlords and tenants regarding tenancy deposits, retaliatory evictions and section 21 notices.
The legislation is complicated and one of the most important as it includes the Section 21 rules on the required process for evicting a tenant should it be necessary. The forthcoming Rental Reform Bill will effectively abolish the Section 21 process for good. More on that when it happens.
General Data Protection Regulation (GDPR)
The Data Protection Act 2018 controls how a tenants personal information is used by agents and landlords.
Following the UK’s departure from the EU, a new domestic data privacy law called the UK-GDPR took effect on January 31, 2020, and, alongside the Data Protection Act of 2018, governs all processing of personal data from individuals located inside the United Kingdom.
Gas Safety (Installation and Use) Regulations 1998
Landlords are required to ensure that gas safety checks are carried out every 12 months by a Gas Safe registered engineer on all gas appliances and flues at the property.
Record of the safety checks must be kept for a minimum of two years (or from 6 April 2018, for the time of two further checks) and issue a copy of the most recent certificate to existing tenants within 28 days of the check and new tenants before they move in.
Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020
These relatively new Regulations require landlords to have the electrical installations in their properties inspected and tested by a person who is qualified and competent, at an internal of at least every 5 years.
Landlords have to provide a copy of the electrical safety report to their tenants prior to moving in, and to their local authority if requested.
Deposit Registration Regulations
All tenancy deposits must be registered in a government-approved tenancy deposit scheme (TDP) if you rent your home on an assured shorthold tenancy.
The deposit must be registered in the scheme within 30 days of receipt and you should provide a copy of the registration details and certificate to the tenants within the 30 day timescale.
Housing and Planning Act 2016
In May 2016, the Government brought The Housing and Planning Act into law introducing new rules for landlords and letting agents. The aim is to improve how housing is managed in England.
Items included within the legislation were the introduction of banning orders, rent repayment orders and the introduction of a database of rogue landlords (currently accessible by local authorities only but this may change with the aforementioned Rental Reform Bill).
Energy Efficiency Regulations 2015/2018
The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 established a minimum energy efficiency (MEES) level for all domestic private rented properties in England and Wales that are required to have an Energy Performance Certificate (EPC).
When the MEES regulations were first implemented in April 2018, landlords could not let properties on new tenancies to new or existing tenants if the EPC rating was F or G. From 1 April 2020 this was extended to cover all relevant properties, even where there has been no change of tenancy.
The Government is now muting the idea that all new tenancies in private rented properties should be at an EPC rating of 'C' or above by 2025 and all existing tenancies by 2028.
Homes (Fit For Human Habitation) Act 2018
The act makes it mandatory for landlords to ensure that rented properties are safe and secure for living. This applies for the entire duration of a tenancy.
If the set criteria are not met, tenants can potentially sue their landlords. The landlords can then be legally ordered to fix all issues or pay compensation to their tenants. We would also recommend you carry out regular property inspections to ensure that you meet the minimum standards
Failure to adhere to many of these regulations and legislation can lead to significant fines and penalties, and, in some cases, imprisonment.
I apologise for the overload of information and assure you that the intention is to provide information, not scare you half to death!
There have been many pieces of legislation bought in over the last six years which can have significant implications to a landlord that they are simply not aware of.
If you have any questions or queries, then please do not hesitate to contact me and my team will do our best to guide you as required.
Contact Laura on 01332 300197 if you have any questions or to arrange a no obligation call with one of our letting experts.