Did You Know The Effects Of The Deregulation Ac...

HELEN TOWNSEND >

Head of Dispute Resolution

Mon 1 October 2018 Did you know the effects of the Deregulation Act 2015 will extended to all tenancies from 1st October 2018 in England?

This year has already seen a series of changes which have made the letting of properties more onerous for landlords. With changes including the reduction of tax relief on buy to let mortgages, the new GDPR in place as well as proposals for increased tenancy duration, regulation of managing agents and client money protection to come, it is an increasingly more difficult time for landlords striving to make a living from their properties. On top of all the mentioned changes, we are also now fast approaching the end of the three year transitional period brought in by The Deregulation Act 2015; ending on 1^st October 2018.

All landlords and agents should by now be aware of the Deregulation Act as the changes it brought in have effected those tenancies which started or were renewed for a new fixed term after the 1^st October 2015 (‘new tenancies’ as they are known). When the transitional period ends, on 1 October 2018, the changes brought in by the Deregulation Act will apply to all ASTs including retrospectively to those entered into before October 2015. This means that if they have not already, landlords with pre-October 2018 tenancies, will need to take steps to ensure that their tenancies comply with the Act. Having said that however, not all the changes will apply and they will not apply uniformly so it is not quite that easy.

What will change on 1^st October 2018?

In relation to retaliatory evictions, landlords will be prevented from serving a Section 21 notice in certain circumstances if the landlord has received notice requiring the landlord to carry out repairs.
Landlords will not be able to serve a Section 21 notice in the first four months after the start of an AST. This change will obviously not affect ASTs that were previously exempt as they will have already passed the four month period. However, a time limit change that will impact older ASTs is that landlords will have only six months from the date the Section 21 notice was given in which to act on it. If they don’t act then a new notice will be required.
Until 1st October 2018 a landlord has had the option of using a non-prescribed form of notice if the AST was granted before 1st October 2015. After 1st October 2018, landlords will be required to use the prescribed Form 6A for notices for all ASTs, irrespective of when they were entered into.
The change that will have the most impact on landlords and managing agents is that they will have to give tenants prescribed information on the condition of the property for all ASTs (both new and pre-existing) and landlords will not be able to serve a Section 21 notice on tenancies unless they have provided tenants with the following information at the start of the tenancy going forward. This requirement also has to take place before the tenant moves into the property for new tenancies.

The documentation required includes:-

The property’s Energy Performance Certificates (EPC), except where a property is not required to have an EPC such as where the landlord is letting a room on a single AST in a House in Multiple Occupation (HMO).
A gas safety certificate covering all fixed as well as portable gas appliances provided by the landlord for the tenants’ use.
The Ministry of Housing, Communities & Local Government’s (MHCLG) How to rent guide: This can be provided digitally or as a hard copy if the tenant requests it. Agents and landlords should not simply supply a link to where the document can be found. The requirement to provide the ‘How to rent’ checklist is not obligatory for tenancies before 1 October 2015 unless they have been renewed after that date, but landlords may wish to consider providing a copy of the guide as good practice regardless, so that this can be noted on the claim form if possession proceedings are required at a later date. The ‘How to rent’ guide is periodically updated so it is important to ensure that the latest version (currently 9 July 2018) is provided.

Up until October 2018, a landlord wishing to issue a Section 21 notice could serve all the correct documents one day and issue the Section 21 notice a few days later. The key change coming into force in October 2018 is that these documents must be provided at the start of the tenancy, before the tenant has moved in. It is this ‘beforehand’ provision which means that many landlords may find themselves in a difficult situation of not being able to recover possession via Section 21 because of their own failures.

The changes mean that landlords have to be more careful in undertaking the required steps before issuing a new tenancy and letting the tenant move in. If they chose not to do so, or fail to comply though lack of knowledge, then unfortunately they will find themselves in a difficult situation should they need to recover possession of their property back.

If you need more information regarding the requirements or assistance with recovering possession of a property or a claim for rent arrears then please contact a member of our Dispute Resolution Department to discuss this with us.