The New Decade Begins with Plenty of Change in the Lettings Industry
Author: Rent Guarantor
We're only a few weeks in to 2020 and a new decade, but already, there's been a lot of activity in the lettings market, particularly from a business and management perspective. A number of developments, including plans to create a local Government-led lettings agency, new city-wide rules for planning permission requirements for HMOs and a campaign to more closely regulate the short-let sector, suggest the UK's Letting industry is moving forward to support the growing need for rental homes.
This flurry of activity, which shows few signs of stopping, highlights the industry is ready for the next step of growth. In addition, it means that new ideas, rules, agreements and regulations will be put in place to benefit everyone involved in the UK’s lettings market. That includes investors, landlords, letting agents and tenants.
Local authorities share letting industry plans
While residential construction activity in the UK is continuing, the cost of housing remains expensive for many. With that in mind, Durham County Council is planning to create a new rental agency to help ensure everyone has a suitable home.
The county council has received just over £250,000 from the Government’s rapid rehousing fund and it intends to use that money to create a lettings agency to help place people in the Private Rental Sector (PRS). The current idea is to purchase five-year leases from private landlords for a variety of property types and sizes in the county. Then, to help people and families in need of rental accommodation rent, move in and live in those homes.
"We have a duty to provide housing to some families but sometimes it is difficult to find suitable places for them,” a Durham County Council Spokesperson said. “We are really pleased to be moving forward with the creation of the agency which will allow us to provide decent, affordable private rental accommodation for households in need and on low incomes.”
If the agency is given the go-ahead, it will be run at ‘arms-length’ from the council, and is expected to lease 70 properties in its first year, which will be used to home people in Durham.
In addition to that, Birmingham City Council is set to bring in a city-wide regulation that means all properties that are converted from family dwellings into a Home of Multiple Occupation (HMO) must gain permission before doing so.
The City council has also requested that owners and landlords of small HMOs which have already been converted, inform the council of the change.
By keeping abreast of how many family homes have been converted into HMOs and will be converted into HMOs, the council will be better informed as to the provision of rental accommodation across the city. That’s useful for future city and residential planning needs, as well as ensuring new HMO conversion plans are suitable.
Scotland’s short-term lets industry
Separately, ARLA Propertymark is supporting an initiative from the Scottish Government to more closely regulate the short-term lettings industry. The reasons the lettings regulatory body is in agreement with Scotland’s plans is because, while short-term lets are useful for any local economy and can prove profitable for property owners, they can also mean that some areas are lacking in long-term rental options for the local residents.
“By giving councils the power to set conditions around short-term lets licences and put in place planning control areas to tackle hot spots, communities across Scotland will be able to decide what is best for them and their local economy,” said Kevin Stewart, Housing Minister.
The Scottish Government’s plan is to introduce a licensing scheme for short-term lets. It’s expected this will be in place by the Spring of 2021.
“It’s positive to see that the Scottish Government is taking steps to regulate short term lets,” said ARLA Propertymark’s chief executive, David Cox. “By further regulating the sector, local authorities will be able to control the number of short-term lets in Scotland, but also ensure that effective health and safety requirements are put in place to protect those seeking a short term let.”
By taking the right steps, local councils and areas across the UK can take more control of housing provision and do their part to make sure the right rental homes area available for all those who need them. This will also prove positive for landlords and letting agents as it will make it easier to identify the type of rental housing that’s required and permitted in different areas.
Developments like those we’ve identified highlight the ongoing importance of the lettings industry in the UK and also that it’s likely to be an area of growth in the coming years.