How the world is changing for tenants
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Over the last few years, there has been a lot of change for tenants around the world as the world came to grips with the Covid crisis but now we are coming out the other side of it. As some places are making properties easier to buy, some countries are continuing to make the process of getting onto the property ladder as hard as ever. But what is changing for tenants today? Quite a lot actually.
Changes in the law
Over the last twenty years, the landlord market has grown and tenants have been the ones to bear the brunt of it. This has meant that tenants have had to pay extra fees in order to secure their new homes. Since 2019, the law has changed and the tenant fees act 2019 has been put in place to help stop landlords and rental companies from charging excessive amounts on top of the rent. This has given tenants an extra form of protection as they can now fight back against companies who charge an excessive amount of money.
Change in taxes
A few years ago, the rules around mortgages for rental properties changed and it was illegal to rent a property under a regular mortgage. These Buy to Let mortgages changed extra and made the monthly repayments ridiculous. Instead of selling their properties, landlords put the rent up and it was up to the tenants to swallow the additional costs. Now there are additional taxes that have been introduced that are hitting landlords, not the tenants. These taxes cannot be placed on the tenant. This is great news for tenants in one way, but not in others.
Deposit passports
How many times have you rented a house, paid a huge deposit, and then had to wait weeks to get it back when you move? This is a common tale for renters but it looks like this is about to change. There is talk of a new Renters Passport that holds your deposit and can be easily transferred from property to property. This will take a lot of pressure off renters who need this money back to put down as a deposit for their new house. It will also prevent landlords and property companies from keeping the deposit without a good reason.
Selling up
Because of the taxes we mentioned in the previous point, there is a mass exodus of landlords who are not prepared to pay these taxes. In return, they are selling up their properties and evicting the tenants. Some of these tenants have been there for many years and were hoping to get a few more years out of the tenancy. This is leaving the tenants with the question, do we try for another rental that could be sold from under us, or do we buy the house we have been living in from the landlord?
Eviction notices
During the pandemic, it was very hard for landlords to remove tenants from their property. The eviction notice that had to be given was six months, and this is now being reduced to 4 months in England. They will also be allowing the use of bailiffs to remove tenants from the property, something which had been placed on hold during the pandemic. This will be tough on people who are facing homelessness as the current system is overstretched. But, it also means tenants can be evicted, even if they are good tenants.
Tougher on landlords
As we mentioned, there are a lot of new laws coming into effect to protect tenants, and one of these laws will help protect tenants and the state of the property. There have been countless stories that have featured a tenant complaining about the state of a property only to be told to move out if they don’t like it. Now, if there is an issue with the electricity in the property, the landlord will have to deal with it. Why? Because they are required by law to have an electrical inspection carried out every five years from June 2021 onwards.
Tougher on tenants
If there is one thing that is sure, there is a much tougher time for tenants ahead. Because of landlords selling up properties, there is a large number of people who have nowhere to live. These people cannot get a new rental because they are all being sold up and the market is too competitive. And, they are unable to get a mortgage because the rules around mortgages have been tough for years. These factors are putting a lot of stress on the services and many people, including families, are being placed in temporary accommodation with no end in sight.
Changes to the market
If there is one thing that is for sure, there is a lot that is changing within the housing market. It is going to be tough on a lot of people over the next few months or years. The changes are welcome in some aspects but they are creating unnecessary hardship for people. Over the next few years, the homelessness services will be stretched as they struggle to cope with the demand for housing. We could end up seeing changes to mortgages in order to get people out of social housing and onto the housing ladder. There are many people who can easily afford a monthly mortgage repayment but struggle to get the bank to agree with them on this. However, what the long-term effect on the housing and mortgage market will be is still up to debate.
At this moment in time, there is a lot changing within the housing market and tenants will have to try and keep on top of the new rules. Why? Because some of these changes directly benefit them. If you are renting right now, it might be worth your while reading up on the changes that are happening in your local area and see how they benefit you. Or, at the very least, you can prepare yourself for the possible changes that could be coming your way.
