The former Association of Residential Letting Agents (ARLA) Chief Executive, David Cox, has announced that the earliest time the Renters Reform Bill could come into effect is late 2024. It’s important to note that this timeline is without factoring in the complications of a General Election.
In that position, Cox said:
“The Renters’ Reform Bill is now going ahead after several delays this year, though the earliest it’s likely to come into effect is the end of this year, and a general election could further complications. Above all else letting agents and landlords want clarity, so that they can plan for the future and agents can provide the right guidance.”
Cox also highlights how the Energy Performance Certificate requirements in some form will also come to light in the not-so-distant future, therefore, landlords who have a lower EPC-rated home should keep this in mind and think about improvements they may be required to make. Although, with the deadline pushed back all the attention is focused on the Bill, it is likely that green improvements could be pushed back while the focus is on the changes the Bill will bring for landlords and tenants.
Landlords have said in a recent Rightmove survey that a quarter said how they intend to make energy efficiency improvements to properties that are rated below a C, in comparison to more than a third last year. Also, 21% of those landlords who own properties that are rated below a C have said they intend to sell them, compared to 33% last April.
Rightmove has also said that the rental market has improved throughout 2023 between supply and demand even though there are still much more renters looking to move than homes available.
Letting agents have said that each home they advertise receives 11 enquiries currently from renters, in comparison to 14 this time last year. Usually, enquiries are lower in the winter months as opposed to the summer months, for example in August 2023 there were 25 enquiries per property.
It has recently been announced that mortgage rates have finally been slowly reducing, the average five-year fixed mortgage rate for the first time since June is now below five percent.
Although, the portal still warns people that mortgage rates are likely to be high this year, and for first-time buyers saving a deposit would still be a huge challenge, especially with the added costs of living pressures, meaning there is still likely to be an ongoing demand for properties in the rental market especially from those first time buyers who need to organise and plan a budget for their future.
Tim Bannister, portal spokesperson says:
“The downward trend of mortgage rates and the improved balance between supply and demand in the rental market are positive early signs for the year ahead. However, it’s important to remember that mortgage rates are still higher than in recent years, and there are still not enough homes available in the rental market for those looking to move.”
Comment
It is clear to see that first-time buyers are still likely to struggle to be able to afford their first home this year, therefore, there will be an ongoing demand for the renter’s market. Landlords also need to keep in mind even though the Bill is not looking to be enforced till later this year, there are requirements they will need to adhere to.
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Paula Haverkamp is a Senior Associate and Litigation Executive in our Dispute Resolution team, specialising in landlord and tenant matters and property disputes.
For further information in relation to the subjects discussed in this article, please contact Paula or another member of our team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online form.
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