Rental license to bring extra fees for landlords and new rules
As the British government ponders the introduction of a new piece of legislation which will require private sector residential landlords to register with a national organization, media reports are examining the ways in which this change will impact everyone in the buy-to-let industry, including investors, landlords, as well as tenants. The most obvious change would be that landlords—including those who decided to enter the residential rental sector temporarily, as they wait for housing prices to rebound before selling their real estate—will have to pay approximately £50 annually, in order to sign up with a national organization. But so-called “accidental” or “reluctant” landlords are hardly the only ones who may find themselves forced to register with a national organization, if new legislation is enacted. All investors in the buy-to-let sectors, as well as developers, would likely fall under the same criteria; obtaining a license would be necessary prior to renting any property.
A major concern about the proposed legislation is that residential landlords may lose their rental license if they feel to comply with certain safety and quality control guidelines. Should this occur, tenants would be affected, as well as the landlords themselves, since all occupants would be required to vacate the premises within an established time-frame. Officials, however, were quick to ease some of the concerns associated with this clause by noting that tenants would not find themselves without a home “overnight.” More precise information on exactly what these changes may entail will likely be made public within 10 days, but some already fear that the unintended consequence of this legislation would be to discourage small to medium-scale investors from entering the buy-to-let sector.