Responsible Renting - the final report

After having got back from holiday, settled back in, and dealt with the back log, etc, I have finally got around to reading what is the final report from the Law Commission on their housing projects.

The new legal team on Nearly Legal got in ahead of me with a rather depressing report, taking the view that the proposals are basically ineffectual, and the government probably won’t take any notice of the report anyway.

There does seem to be a deafening lack of action by the government on the Law Commissions proposals. In particular the Renting Homes report which has been out for several years now. However there are I suppose a number of excuses for this. For example:

• The fact that on the whole the private sector is not working too badly so maybe action here is not as necessary as elsewhere in the economy
• The need for the private rented sector to grow to provide much needed housing and therefore a desire not to 'rock the boat' which may discourage investment, and
• The need for recent initiatives to bed themselves down.

The last of these is I think particularly important. In the space of a couple of years we have had three major changes, the new Housing Health and Rating System, the HMO licensing scheme and the tenancy deposit scheme. Very shortly there will also be the need for landlords to provide environmental performance certificates. These changes all need time to settle down and for landlords to get used to them, before anything else new is brought in.

For example it has taken Local Authorities some time to get to grips with the new licensing scheme which came into force in April 2006. The first year was taken up with setting up the new schemes from scratch, dealing with the initial rush of registrations, and getting used to things. The second year was building on this, so it is only now that Local Authorities are starting to do more enforcement work. I am pleased to see many more reports of enforcement action for landlords default, and no doubt this will continue. It will probably take quite a few more years (bearing in mind the limited staff resources available to most Local Authorities) before they dig out all the recalcitrant landlords, and are able to say that they have most of the HMO landlords in their area properly licensed.

Likewise with the Tenancy deposit scheme. As set out in my earlier post, it appears that many landlords are still not compliant, so again this will take some time to work through.

In the circumstances I think that the Law Commission are right not to go for major change, but to seek to strengthen the existing initiatives. Their main proposals are:

• To make landlord accreditation available everywhere rather than in just a few areas, as now
• To set up a housing standards monitor body to carry out further research, develop a single code of practice, and trial initiatives (such as a scheme for home condition certification)
• To have all letting agents regulated (Everyone agrees with this! Apart from the cowboy letting agents of course)
• And to carry out proper evaluation of any new reforms introduced

This all sounds pretty sensible to me. It will lay a foundation for further work, won’t rock the boat too much and discourage new landlords just now (particularly important in the present economic climate), and probably won’t cost too much. The Law Commission also make the point that there is a cost in doing nothing, as poor housing creates costs elsewhere in the system, and therefore (taking a wider view) expenditure in the field of housing could result in significant savings elsewhere in the economy.

There are a number of other reports which have been published recently (which are set out in the Law Commissions paper), plus there is the report commissioned by the government on the private rented sector being undertaken by the University of York which is yet to be published. It may be that once this is out, and now that the commission has completed its housing project and the government is able to look at it as a whole, together with the other reports, government may now decide to do something. For example take steps to bring the Rented Homes Bill onto the statute book.

If you are interested in housing, it is probably worth getting hold of the report – which can be downloaded from the Law Commission web-site here and in the Landlord-Law Law reform section. As usual it is well written and readable (bearing in mind that it is a legal report). I was pleased to see that Landlord-Law was mentioned favorably (page 17), and also interested to see that the responses via the Landlord-Law answer form provided nearly 30% of the total. There is a very interesting appendix where they report on what people responding to the consultation actually said.

Interesting times ahead!