What does levelling up mean for landlords?

Levelling Up Secretary, Michael Gove, published the government’s Levelling Up White Paper on 2nd February 2022.

In amongst the wide ranging policies which are designed to ‘close the gap between rich and the poor’ there are three key proposals which will affect the private rented sector.

• Removal of Section 21
• Decent Homes Standard
• National Register for Landlords

Removal of Section 21

The removal of the Section 21 provisions or ‘no fault evictions’ was a hot topic prior to Covid-19 dictating most of the Government’s priorities. Our blog from 2019 covers the consultation which didn’t allow any provisions to help the student rental market.

Unless the Government strengthens the powers of section 8, and fixes the court system, the removal of section 21 could significantly disadvantage landlords. David Cox, Legal and Compliance Director at Rightmove commented:

“Depending on what the government come forward within the Renters’ Reform white paper, (the abolition of Section 21) might actually be better for us going forward.

We hold onto Section 21 because that’s what we’ve had, but it’s not the best system. It hasn’t ever been the best system because you basically have to take the view of ‘I’m going to lose all my money, I’ve just got to get the tenant out”.

Whereas if we have a reformed Section 8, where the landlord gets their money back or at least gets some of their money back, that could be better going forward, providing they fix the court system alongside fixing the law.”

Decent Homes Standard

A press release accompanying the White Paper said “The government will announce a plan that for the first time ever, all homes in the Private Rented Sector will have to meet a minimum standard – the Decent Homes Standard. ”

A White Paper will be issued in the Spring of 2022 to consult on introducing legally binding Decent Homes Standards in the Private Rented Sector.

Back in 2006, the Department for Communities and Local Government published a guide detailing what Decent Homes Standards might mean:

4.1 The definition of what is a decent home has been updated to reflect the Housing Health and Safety Rating System (HHSRS) which replaced the Housing Fitness Standard on 6 April 2006. Landlords will find it helpful to refer to the two volumes of statutory guidance on HHSRS1. The general principles of application have been expanded as set out in paragraph 4.4 below and paragraphs 4.5 and 4.6 clarify what properties are covered by the Decent Home standard. A decent home meets the following four criteria:

a) It meets the current statutory minimum standard for housing

4.2 Dwellings which fail to meet this criterion are those containing one or more hazards assessed as serious (‘Category 1’) under the HHSRS.

b) It is in a reasonable state of repair

4.3 Dwellings which fail to meet this criterion are those where either:

• one or more of the key building components are old and, because of their condition, need replacing or major repair; or
• two or more of the other building components are old and, because of their
  condition, need replacing or major repair.

c) It has reasonably modern facilities and services

4.4 Dwellings which fail to meet this criterion are those which lack three or more of the following:

• a reasonably modern kitchen (20 years old or less);
• a kitchen with adequate space and layout;
• a reasonably modern bathroom (30 years old or less);
• an appropriately located bathroom and WC;
• adequate insulation against external noise (where external noise is a problem); and
• adequate size and layout of common areas for blocks of flats.

National Register of Landlords

The White Paper indicates that the Government will ‘explore a National Landlord Register’ as part of it’s measures to ‘reset the relationship between landlords and tenants…” but provides no further comment on it.