0:00 – Intro
1:25 – Clinical record taking, what is it and why is it so important.
2:10 – The full rollout of MEES (Minimum Energy Efficiency Standards)
2:48 – Proposed EPC Rating increase from E to C in 2025
4:00 – Introduction of EICRs for all new tenancies
5:29 – New How to Rent Guide and what you need to do
7:22 – Multiple changes in Form 6A
8:43 – Looking forwards & the abolition of Section 21
10:22 – The right to rent space is changing
12:02 – EPC Consultation, proposing to move from an E to a C
13:01 – The eviction space shows no sign of letting up
14:56 – What 2020 has meant for our agency KPIs and area statistics
16:34 – We can help and support you
2020 Round Up
2020 has been a challenging year to say the least, it has been a year like no other and, hopefully, we will never see its like again!
One thing 2020 has taught us, is that the lettings industry is extremely resilient, being told we aren’t key workers, then we are… being told to close all branches yet maintain a full maintenance support presence and having to contend with changing government forms and documents, which at one point were changing daily!
There have been many policy changes throughout 2020, so we have put together a round up, looking at the major ones and pointing out a few that you may have missed, in the melee.
We are also horizon scanning, looking at what is coming, so you can be proactive, instead of reactive.
Clinical Record Taking:
This is something that isn’t spoken about very often, but it’s critical when managing property, not least through such turbulent times… but what is it?
Clinical record taking is keeping very detailed, dated accounts of EVERYTHING. Once the dust has settled on 2020, there will be a reckoning, we have already begun to see the rumblings of it now, with “no-win no-fee” companies targeting tenants to sue their landlords.
So you need to ensure you have
- Behaved appropriately, keeping safety at the forefront of everything you do
- Documented every action, every policy, every visit to a property, in case it is ever needed.
For example – when you are doing viewings, have you checked that the house is happy with you and a prospective tenant being there, with in-person viewings? If you have, have you kept a copy and a log of these conversations, so they can be recalled if needed?
What should you do about this?
As a landlord you are ultimately liable and responsible for what happens at your property, so you need to make sure that you or your agent have good procedures in place for clinical record taking. If you aren’t sure… ask… we are always happy to share our procedures with our landlords.
MEES (Minimum Energy Efficiency Standards) Phase 2
With everything going on in 2020, you would be forgiven for missing this one…
The full rollout of phase 2 of MEES occurring in April 2020. Now every property MUST have an EPC rating of ‘E’, in order to be rented.
Phase 1 in 2018, only applied to new tenancies, but phase 2 applies to existing tenancies too.
There are exemptions, but these are generally for listed buildings and you need to go to the council directly, who will evaluate your property, on a case by case basis.
What should you do about this?
If you haven’t already, you need to look through your properties and identify any which are below an E on their EPCs. Then we suggest you contact the surveyor who carried out the EPC, as they should still have their notes and be able to advise on how best to increase your property’s rating so that you can get the set works completed. We also recommend that you speak to your local council, as they may be able to help you with grant money, to fund some of the works.
EICRs for all new tenancies
One of the big changes in 2020 was the introduction of the Electrical Safety Standards in the Private Rental Sector (England) Regulations 2020. This states that all new tenancies MUST have a satisfactory, in date, EICR to be valid and that you may not enter into a new tenancy agreement without one.
Similarly to MEES, phase 1 (July 2020) is for new tenancies and phase 2 (1st April 2021) will be for all existing tenancies.
If you have a long standing tenant and you are working to the April deadline, be sure not to book things in, last minute. NAPIT are already concerned about getting the works done, citing COVID as the reason for potential delays. Get it done in Jan/Feb, to save yourself any additional hassle and allow time for any potential works that may need doing, should the report fail.
What should you do about this?
The first thing you need to do is to highlight which properties are going to need EICRs. As part of your moving out procedures, if someone gives you notice, then you should be booking one in immediately. For all long standing tenancies, you must have a satisfactory report by April 1st 2021, so we suggest that you book these in early, don’t wait until March, because if something is wrong, you will have a real challenge booking in the work. Get your reports done in Jan/Feb, don’t enter into a price war, when electricians are in high demand in March/April, be smart and be proactive.
New How to Rent Guide released
December 2020 saw the release of the new “How To Rent Guide” one of the many documents that must be served with an AST, in order to create a proper tenancy (Deregulation Act 2015)
Unlike its predecessor, this new version had some considerable changes… the document:
- Explains to tenants that they must receive an EICR with their tenancy
- Explains to tenants about rent repayment orders
- Tells tenants about selective licensing
- Advises tenants that contents insurance is their responsibility, not the landlords
- Explains to tenants what they are liable for, should they wish to leave before their fixed term, or notice period has expired.
- Explains to tenants their rights, if being evicted and where they can seek advice.
To pick up on point 6 for a second. The new How To Rent Guide, advises tenants that they can only be evicted from a property with a court order and that, if they are unsure, they should seek advice from organisations such as Shelter. As you will know, Shelter don’t often fall on the side of landlords.
So it is our advice to mediate as early as possible in the process, finding a solution that works for both parties, so your tenants don’t feel the need to seek help from Shelter or anyone else. Mediation is ALWAYS better than eviction. As agents, a huge part of our role is working with landlords and tenants, to find a win-win solution!
What should you do about this?
You need to ensure that you have the latest copy of the How To Rent Guide downloaded and are serving it with every tenancy. If you are not, you are in breach of the Deregulation Act 2015 and are not creating a proper tenancy. We would also advise that you take the time to read through it, to understand the changes. Lastly, check with your agent, which version they are using too. If they don’t know there is a new one, that should be a HUGE red flag!
Multiple Changes in Form 6A
As many of you will know, Form 6A is the notice seeking possession under Section 21 (no fault eviction) and this has changed many times during 2020. If you serve a wrong version of this form, when the judge hears your case in court, it will be thrown out immediately.
Given the condition of the eviction space right now, with the extreme backlog experienced by the courts, serving the wrong form could be a catastrophic waste of time, costing you many, months in wasted time, money and stress.
What should you do about this?
You should ensure that every time you want to serve Form 6A, that you download a new copy. DO NOT rely on an old template, or it will almost certainly be out of date, costing you a LOT of time. Ask your agent to email you their copy of Form 6A and check it against the government website, to make sure that they are keeping you compliant.
Horizon Scanning – What is coming next?
A huge part of compliance is being able to be proactive, looking forwards and knowing what is coming, so you can be one step ahead of the game, it gives you more time and allows you to choose the right options for you, based upon the circumstances.
We have looked at a few which are on their way
- The abolition of Section 21
While there is nothing set in stone yet, the writing is on the wall for Section 21. Many groups are lobbying hard against “no-fault evictions” in an attempt to get them removed and the government has been softening it with changes, such as the 6 month notice period. Watch this VERY closely, as this could change the face of lettings forever. We are hoping that if this does come in, it will be coupled with a huge reform to section 8, but we shall have to wait and see. - Changes in the right to rent space
A new portal for right to rent checks was launched in 2020 and with proposed immigration changes on the way, it is only natural that the right to rent checks will have to be changed too. Potential changes are being discussed regarding the rights of EEC citizens and Swiss Nationals, so make sure you are conversant and compliant with any of these. Also any “light touch” right to rent checks, that you have already carried out, during the pandemic, will need to be reviewed by June 2021. - Proposed changes of EPCs from ‘E’ to ‘C’
A recent consultation published in Sep20 lays out the government’s plans to ensure that every rented property in the UK meets a rating of a C on its EPC report. Watch this closely, as this could have wide reaching implications. A grade C is hard to achieve, especially for solid wall properties and if you need to internally insulate, it will be expensive and you will lose floor space (potentially devastating for licensable HMOs).
The Eviction space is going to get worse before it gets better
Without a fast track or egregious case, you are likely to be looking at a 12-18 month wait time on a court date for any new eviction hearings. Mediate, Mediate, Mediate… do your absolute best to find a win-win solution to any problems, so that you don’t have to go to court. Also be very careful when taking on new tenants, because if there is a problem, you will have a struggle gaining back possession of your property.
2020 Round-Up
There is no doubt that 2020 has been difficult… but that doesn’t mean it is all doom and gloom! During 2020, we have been able to:
- Keep our void rate negligible – 0.06%
- Continue to have £0 rent arrears
- Continue to have £0 bad debt
- Still (after 5 years) not needing to keep a single penny of a tenant’s deposit.
But don’t get me wrong, our team have had to work twice as hard to achieve the same results. There is an increase of properties on the market by 10-20% and a HUGE decrease in the number of people looking to move, by about 60%, compared to this time last year, which has been consistent month on month and even worse during lockdown.
One huge thing 2020 has taught us is to continue to be adaptable, to adopt new business practices as often as possible and know that what worked yesterday, may not work tomorrow. Embrace the change, because good quality tenants are still out there!
If you would like to know more or would like some help with:
- Compliance on your property
- Solving a tenant concern you have
- Finding a new tenant
- A hands-off passive management solution
We are here to help and support you, contact us now or book a call
