Landlords Could Be Forced to Repay 24 Months Rent

Added: 2026-05-28

[00:00:00]We're actually here today to talk about a piece of legislation which is the biggest change in our industry in 37 years that is going to be coming into force in about 4 hours. Even today, I still and the lawyers still and the industry bigwigs still have gray areas in this legislation because it's the way that it is interpreted. It's different people's interpretation. there's still a lot of blurred lines and a lot of gray areas. So today, just please do bear with me. Um because what will happen and what happens with all laws really is that the legislation is written and then what will start to happen is case law through the courts and that's how we will form our judicial decisions. I don't know if you guys remember but back I think it was around 2014 a massive court case called super strike fees Rodriguez and it was all to do with deposit legislation that was a one of those cases that set precedent then for us with regards to deposits. So it is all um new to all of us but we do need to be very very mindful. So without further ado I am going to crack on. This is the biggest change in our industry for 37 years. I was talking with this gentleman sat here on the aisle earlier and the biggest change that I'm talking about he was actually operating prior to that was in 1988 when the housing act was born. Now when the housing act was born it was a real positive for our industry because prior to 1980 it was actually the 15th of January 1989 it came into force. Prior to that we were in a world of rent controls in a world where you couldn't get your property back from tenants. landlords would die before they got their property back because there was succession rights. So the change in 1989 was positive. And then there were some changes in uh 1997 that made it even better. But unfortunately with this piece of legislation, it seems like some of the areas that they've implemented that we're going back to some of those challenging times particularly around rent that we were in 1989. So this is the biggest change to our industry in 37 years and I am literally done with renters's rights. I have had to change every process in our business, every document that we use, everything that we do. It has been a challenge but we're there and fa they're bringing it in in three phases and good old government right so what they thought was phase one first of May what we'll do is we'll load everything that the landlord needs to do in phase one yeah everything that the landlords need to do that's what we're going to put in phase one anything that they've got to do like create a property ombbudsman for landlords like create a database oh no we won't do do that yet. We'll do that later in phase two. And phase 2 is expected um late 2026, early 2027.

[00:03:03]Now, at my last seminar, I said because it is the government and we're waiting on them getting ready, I thought it would be more so 2027 rather than 2026.

[00:03:13]However, I was speaking to um one of our members and she's actually trialled the database. So, it is there and it is ready. It's just in beta testing. So phase two is now likely to be at the end of this year. There will be a property database created and every landlord will have to register themselves on the database along with their properties and all of the property information. So you see what they're doing here, don't you?

[00:03:42]They're making us visible. Now this is already in force in Wales under a piece of legislation called Rent Smart Wales.

[00:03:50]Every landlord must be registered, every property must be listed, and all of your documents must be uploaded. So, what that means is, you know, this 60 million pound the council have got to spend on enforcing this against landlords. Well, they don't even need to leave the office because they can see if you haven't got what you're supposed to on the wonderful database. And of course, I'm sure the local authority will have full access to that and tenants will have minimal access or agents will have minimal access. But those are the two things in phase two. Yes, end of this year. That's when we're thinking. So the database and the ombbudsman is in phase two and it's predicted to be end of 2026, maybe early 2027. And the two things that are going to happen in phase two that will affect you immediately is it will be that requirement to register with a redress scheme. So an ombbudsman at the moment letting agents have to do that.

[00:04:40]Landlords don't. I have to say I quite like the fact that landlords should do that because do we have any self-managing landlords in the room? So for all of you guys, your tenant has no right to redress. They have nohere to go to complain if you get it wrong. And whilst I believe you guys are good landlords because you're in a room like this educating yourself, learning and and and looking at how we should be operating, let me tell you there are a lot of landlords out there that are not.

[00:05:08]And actually on one of our webinars, I can't believe that a landlord asked me when did the deposit regulations come out? I wasn't aware I had to register the tenants deposit and I said 2007.

[00:05:21]So they are out there but um so late 2026 we're going to be looking at phase two which are those two things that landlords will need to do. Unfortunately they are going to come at a cost and costs are rising for you guys as landlords. If I had a magic wand, I would love to wave it to eradicate that, but I can't. And then phase three, actually, it's no longer 2030. It's expected in around 2034.

[00:05:45]So, we've got about another 10 years to worry about that. And that's all to do with decent home standards, AWAB's law, and the condition of the property. But do not forget that we already have at least I would say four pieces of legislation if not more that we have to comply with that is in in relation to um the quality of a person's property. So you have the gas safety regulations, the electric safety regulations, you have the smoke alarm and carbon monoxide detector. You also have the homes for fitness and habitation. You have section 11 of the landlord and tenant act 1985, consumer protection act 1987. All of which says you should maintain your property and make sure it's safe to live in. So that's why they've pushed the decent homes right the way back until probably another 10 years. So these are the things that are changing. Okay. So these are the things that we're going to talk about today. And as of tomorrow, I keep calling it the new world because we've been in our old world for a long time and tomorrow it is going to change.

[00:06:41]So we're going to talk about stronger authority enforcement, periodic tenencies, the fact that section 21 will be gone. We actually served our last section 21 yesterday. The girls in the office were they were like, "Well, we probably actually served about eight or nine of them yesterday, but the girls were like, "This is the last one we're ever going to serve." Um, I'm going to talk to you a little bit about existing section 21s. Do any of you have any section 21s or eights out there currently? Good. I'll talk to you about that. Um, I want to talk to you about how we will evict tenants in the new world. Um, with the new grounds, I want to talk to you about the rent in advance restrictions because this is really important. The amount of rent that you can take. Not only that, but also when you request the rent because that is a real key change that could cause a problem moving forward. I want to talk to you about the changes in rent increases because if your rent isn't where it should be, you will still have the right to raise it. They haven't given us a rent cap. Although Rachel Reeves the other day announced that she thinks we should put a rent freeze on this year. Hopefully that won't happen, but there's new rules around rent increases and it's there's some important factors for you to bear in mind. Rental discrimination, rental bidding, and also rent repayment orders.

[00:07:57]Now you see rent repayment orders for me is probably the biggest thing that I would be worried about as a landlord because a rent repayment order is something that can financially benefit the tenants personally. So not the local authority not being enforced. It's they can claim up to 24 months rent back should a landlord for foul of one of the pieces of legislation that allows them to do that. So, as you can see there, that is a big f the rents roughly around 950 in your area. Now, let's round that up to £1,000. There's potentially 24 grand there on the table for them if you if a landlord does something wrong. And again, I have witnessed landlords that do do things wrong. One of my colleagues, her daughter was living in a property actually in Liverpool, Liverpool city center. Um, she was paying £1,000 a month for an apartment in the city center. It was one of the older type buildings and it was riddled with damp. Absolutely riddled to the point where she came to me and asked me for some advice and I says go to environmental health and get the council out. Now the first thing that the council did when they came out was not just look at the damp but they realize that this property was under selective licensing and it didn't have a license.

[00:09:11]Now that is one of the reasons currently now not even in the new world that a tenant can make a claim for a rent repayment order. and immediately she was in a position to take that landlord to court and claim back £12,000. Selective licensing. So in this area it's in Septton and it's in Liverpool. Is it also in the Whirl or No.

[00:09:30]>> No, it's not in the Whirl, but it is parts of um over the water. Um >> over the water I don't know what that means. WL like parts of like WL Beck and Edw. So a selective license is basically a scheme that the go that the local authority can choose to operate in certain parts of a burough of the council and what what the properties that they choose that the area that they choose every property in that vicinity will need to have a license regardless of whether it's a one bed flat a two bed house three bed it has to have a license and Liverpool actually are on their second go round aren't they brought it in in 2015 15. That was a nightmare for us at the time. Um, ran it till 2020.

[00:10:13]Didn't give us a single license because they got it wrong and they didn't selectively license the area. They licensed the whole bora and therefore had 55,000 applications fall on their desk and they never actually issued a license. But that came back into force.

[00:10:26]Alicia, what date? What year? 2022.

[00:10:29]>> Uh, yes, for I think that was for Liverpool and then was a year later >> and they're in for five years. So anybody that rents a property in that in an area that is selective licensed needs to have a license and that is one of the things under the rent repayment orders.

[00:10:42]So, it's really important we talk about that.