Let’s face it, no one likes change forced on them. But change is coming to our industry, the Renters’ Rights Bill has now been fully revealed ahead of its second reading in Parliament, and the extent of the changes will no doubt be causing anxiety to many landlords, yours included. This presents an opportunity for agents everywhere to demonstrate their worth to their landlords.
Let’s not forget we’ve been here before. Similar industry changes have caused similar concerns. The arrears moratorium during the COVID-19 pandemic had some worried it would sink the sector, and the Tenant Fees Act, which limited the fees agents could charge tenants and therefore reduce agency income, was predicted to mark the end of letting agencies as we knew it. As an industry, we adapted and overcame, and we will do so again with the right engagement from the government and our collective eye for opportunity.
For agents like you, this new Bill is a moment to grasp the opportunities it provides. New revenue streams can be generated from various new services such as careful compliance monitoring on behalf of your landlords; managing the enhanced Section 13 rent increase process so that it doesn’t end in tribunal; and eviction assistance on the basis of complex Section 8 grounds. This could assure the future for your agency. And if there’s any negotiation over fees, the risk landlords face of rent repayment orders and £40,000 fines can be your defence.
It’s also your chance to grow your business. Many landlords either manage their own properties or only use agents to find tenants, but in a more complex regulatory space they will want to use all the professional help they can get. It’s your job to show them that you’re the expert to help them understand and manage the transition to the Renters’ Rights Bill. This will be your opportunity to secure their business – not just to let the property but to manage every aspect of it in line with the new legislation.
Let’s break down some key areas where you can grasp these upcoming opportunities by offering expert assistance with the new rules that will be introduced by the Renters’ Rights Bill.
Evictions
With the abolition of Section 21 ‘no-fault’ evictions, the opportunity for you as an agent will be in managing the increasingly regulated relationship between landlords and tenants.
Preventing solvable disputes from unnecessarily tying up court time will be crucial for landlords worried about an extended court process. This is where your mediation skills can shine. By keeping communication lines open between tenants and landlords, you can step in early to resolve issues and potentially avoid eviction proceedings altogether.
If evictions do take place, the Renters’ Rights Bill requires them to be via Section 8. This process typically takes longer than a Section 21 eviction and landlords will need your guidance through complex legal grounds and court proceedings.
You can do a lot to secure that monthly retainer by making sure landlords are aware of the extended timeframe, and by offering eviction support as part of your fully managed services.
In order to sell this well, you’ll need to have systems that track every interaction you have with tenants – payment schedules, conversations about arrears, maintenance reports, noise complaints from neighbours, everything. If you need to evict a tenant using Section 8 under a specific ground such as antisocial behaviour or arrears, this information will be crucial in court.
Arrears management
Tenants’ ability to afford rent can change over time, particularly with wage inflation in some industries not keeping pace with rising prices. Before the Renters’ Rights Bill comes into play, you can charge landlords a fee for re-running credit checks on the tenants their properties, to see if the financial circumstances have changed.
Engage landlords in proactive conversations about any of their tenants who are struggling financially. As we head towards winter, missed rent payments can point to wider affordability issues including utility arrears. In some circumstances support is available – and referring at-risk tenants to organisations such as Citizens Advice can help prevent winter hardship and further rent arrears.
Keeping landlords informed about any developing issues and helping them act when necessary will be an important service, both pre- and post-implementation of the Renters’ Rights Bill.
Pets in properties
Pets in rental properties have often been contentious, but the Renters Rights Bill strengthens tenants’ rights to keep pets. This will allow you to levy a fee on tenants to cover a pet damage insurance policy. Having the right policy on hand to offer landlords who are worried about damage will not only impress your customers, but you may also be able to earn referral fees by working with insurance brokers.
For landlords dead set against pets in their properties, your job will be to help clarify when landlords can refuse pets, such as when a superior landlord has prohibited them.
Rent increases
The Bill limits rent increases to once per year, and only up to market rates. If you’re not already familiar with Section 13 notices, now’s the time to get up to speed because serving them will be the only way to increase the rent for a sitting tenant. It is something you should charge for or include in a fully managed service.
Why charge when it’s just filling out a form? Because the form is only a small part of the work. When serving a Section 13 notice, the best thing you can do for your landlords is to provide tenants with comparative data to help demonstrate that any rent increases are in line with market rates. This evidence from your agency will be key in justifying any rent increase.
And you’ll need to justify it, as tenants can dispute any rent increase at the First-tier Tribunal. An adjudication process is likely to delay any rent hikes, so your ability to show that the rent increase is in line with market rates will be key to avoiding disputes and lengthy waits for a tribunal date.
Decent Homes Standard and Awaab’s Law
If you’re not already the person your landlords turn to when something goes wrong with their property, you’ll be missing out on a prime opportunity.
The Bill extends the Decent Homes Standard to the private rented sector and introduces tighter rules around damp and mould. Awaab’s Law will set strict timelines on how quickly maintenance and repair requests will need to be acted on to keep properties safe and free from hazards.
As an agent, building strong relationships with local contractors is something that will help you sell a fully managed service, as it will be critical to handle maintenance issues swiftly. Your ability to do so will help landlords avoid penalties and rent repayment orders that could come with delayed maintenance. You can also assist any landlords purchasing new properties by getting them up to the right standard before tenants move in.
Bidding wars and discrimination
Pricing a property can be a challenge. There are so many variables and everyone, especially the landlord, will have an opinion. But with the Renters’ Rights Bill outlawing bidding wars – where prospective tenants outbid each other for rental properties – getting the price right the first time will be crucial to landlord confidence and your chance of securing that management contract.
This is where your knowledge of local market trends becomes invaluable. Use your expertise to ensure that properties are neither undervalued nor overvalued, as this will help prevent offers over the asking price – which, if accepted, could land you or your client in hot water.
Additionally, you may need to guide landlords through tougher anti-discrimination laws to ensure they comply with regulations protecting tenants on benefits and those with children from discrimination when seeking placement.
Private Rented Sector Database requirements
Data entry isn’t the most fun you’ll have as an agent, but thanks to the Bill it’ll become a vital skill that you can charge for. The new Private Rented Sector Database requires landlords to register their properties and upload key documents such as gas and electrical safety certificates, but agents can also do it on their behalf.
Managing these important compliance tasks is a great way to onboard a new landlord and demonstrate your compliance knowledge. Organising and scheduling the necessary tests while ensuring all certificates are up to date and uploaded to the database is a chargeable service that takes a weight off the minds of your landlords. Your efficiency in this area will help them avoid unnecessary delays in listing their properties and ensure they meet the legal requirements.
Fines and rent repayment orders
With the Bill introducing fines of up to £40,000 and broadening the scope of rent repayment orders, landlords will understandably be nervous about falling foul of the laws. But these increased penalties are also your chance to justify your fees. You and your agency are the best insurance policy against your landlords facing potentially crippling fines.
Your organisational skills will be more critical than ever. Whether handling paperwork or tracking repairs and legal requirements, savvy agents will be able to show that clear, compliant lettings processes can protect your landlords from significant financial penalties. Getting things right the first time will save landlords both time and money, and secure long-term business for you.
No stone left unturned
The Renters’ Rights Bill represents a pivotal shift in the private rented sector, but we’ve been here before, and we’ve adapted and thrived. For letting agents it’s a chance to stand out and secure new landlords with your much-needed expertise and professional support.
By understanding the legislation and putting systems in place to monitor compliance, you can help landlords stay on the right side of the law. This will not only show them that you are the right partner and that the private rented sector remains a great investment, but will also help your agency thrive and secure new business.
Via @PropertyWire